Crude oil hits new highs. Is the Commodity market here?

First, let's talk about why commodities rise in price when the world market is in recession (downtrend). Commodities in a well-diversified portfolio have a role of protection against a possible crisis, this is mainly because people tend to exchange their money for precious metals when currency and stocks start to lose value, protecting themselves from price inflation.

Oil prices hit record highs on Tuesday, March 8, 2022, after President Joe Biden announced that Russian fossil imports would be banned, including crude oil, in response to the situation between Russia and Ukraine.

Oil soared as much as 7% to trade above $128 per barrel. It ended the day up 3.6% to 123.70 dollars. Brent crude, the international benchmark, rose 7.7% to 132.75 dollars, before trading below the highs.

It is because of these many other issues that we wonder if it is time to start thinking about the commodities market. Since 2020 when Covid-19 appeared around the world there has been a lot of uncertainty regarding the global economy, this is no secret but it is in these moments when money moves from one place to another, that is, people who innovate and accept change are the people who benefit from the crises, of course, there is the example of companies such as Microsoft, Zoom, Google, Mercado Libre, Amazon, etc.. which benefited from the pandemic but others saw their last days in the market or in other scenarios had a hard time because they were not ready for this kind of scenarios, so they were greatly affected.

Now it is difficult to know if the commodity market is here, but it is very important to consider all scenarios and be prepared, so my personal point of view is that we do not have all the indicators to say that the commodity market is here, but it seems that the readjustment in market prices is getting closer, even there are already world-known investors taking shares in their portfolios defensively and it would not be a bad idea to diversify the portfolio with commodities and shares which protect us from bearish markets.