- 1 Bitcoin is now worth 700 barrels of crude oil
Bitcoin is often criticized as a volatile asset by skeptics and critics alike, however, the latest price tank of crude oil from around 50 USD two months ago to around USD 10 USD today has seen the liquid asset being reduced to its lowest since 1986. That is over 34 years ago and since then the black gold as it was once called has dropped to less than a fifth of its value. While crude oil is an important asset in the world today, the drop shows the volatility in asset otherwise viewed as secure and reliable rather than cryptocurrencies like Bitcoin.
The huge price drop is being attributed to the oil war currently undergoing between Saudi Arabia, the largest exporter of crude oil and the Russian Federation, the second-largest exporter. The feud started in March when Saudi Arabia led OPEC (Oil Producing Economic Council) agreed to reduce output to keep prices stable in an equitable manner. Russia, a non-OPEC member objected to cuts imposed on it by the powerful OPEC because of the non-involvement of the USA, the largest oil producer (but not the top exporter). Saudi Arabia and Russia, at odds, are now at a price war, and Saudi Arabia has actually increased production in recent weeks to get Russia under pressure and agree to their dictation. Russia, for now, is holding off the challenge steadily but the tussle may continue for a while and it has led to the price being dropped considerably.
Bitcoin, on the other hand, has been largely stable after the 12 and 13 March price dip and has steadied between USD 6,000-7,000. The price difference has increased so much that one Bitcoin can now buy almost 700 barrels of crude oil, the highest price parity ever achieved with the unrefined fossil fuel mixture.
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