Ongoing upheaval in key oil exporting nations is having an impact on the markets, creating an environment of increased volatility and high pricing.
Anti-government protests and demonstrations, which have already seen the fall of the Tunisian and Egyptian regimes, are continuing to spread across the region, with further unrest reported in Libya, Bahrain, Qatar and Yemen.
With Libya alone accounting for some 2% of global oil production, the political upheaval has had an understandable knock-on effect on oil pricing, and has sent already rising oil prices stratospheric, prompting fears of further inflationary pressures in the UK in addition to a suppression of margins across industry.
While the uncertainty and high commodity pricing was bad for the UK economy and its fragile recovery on the whole, it could also spell a period of heightened activity for spread traders as markets become increasingly more volatile.
The ongoing unrest in the Middle East and north Africa is proving highly influential on the global markets, and its impacts are being felt both worldwide and domestically as investors and speculators the world over react to the goings on. With Libyan protests reaching an apparent fever pitch, the markets are understandably worried about the impact on oil supply, and as the uncertainty continues to dominate so too will prices remain artificially high.
This is not only bad news for the UK, in terms of its potential impact on inflation, but also potentially bad news for spread bettors. While volatility in the markets is advantageous to a degree, the overarching uncertainty caused by the political disquiet could well lead to a period of more ferocious trading, demanding a dynamic and more alert trading style with the potential for significant gains and losses over a short period of time.
Volatile markets present opportunities for traders to earn and lose their investments more quickly, with more rapid, unpredictable market movements. And with the inherently strong leverage spread betting delivers, this can lead to substantial market swings in either direction, with hugely positive or negative effects.