Financial crisis has lead to plunging oil prices, high level of volatility, the turmoil on financial markets, and the steady slide into recession of many economies. The roots of the crisis can be found in the US subprime mortgage crisis, which began in summer 2007. It is well-recognized that the main drive of the deepest recession since the Great Depression was the failure of the US and global debt and credit systems. But the surge in commodity prices, notably oil, was a very significant contributing factor. High oil prices hit consumers hard, notably those with lower incomes, making them reduce spending. They also put an unexpectedly heavy burden on many businesses, both large and small. Most notably, they helped knock the US auto industry “flat on its back,” reducing consumers’ ability to buy cars and leaving Detroit stranded with a product mix that it could not change quickly enough as motorists quickly moved away from what if offered. The automobile industry was knocked flat on its back not by the collapse of Lehman Bros. but by the price at the gasoline pump. Consumers finally began to change their habits when gasoline’s US average price was more than $4/gal. The abrupt spending changes which resulted can seriously disrupt certain key parts of the economy and seemed to be part of the mechanism by which earlier oil price shocks contributed to previous economic recessions. Oil prices doubled between June 2007 and June 2008. To remedy the situation, the Federal Reserve Board tried to provide liquidity to the banking sector, through a series of interest rate cuts and other measures. However, these cuts, together with the worsening economic outlook, weakened the dollar and saw a flight from it into commodity markets, including oil, as investors around the world sought better financial returns. Through hedging against the falling value of the dollar and inflation in this way, these international speculators were treating crude oil futures contracts as financial assets. Their actions greatly increased the amount of activity on futures markets and this had a big influence on crude oil prices, leading prices to rise from $92 a barrel before the start of 2008 to a peak of $147/b on July 11th. This happened while the market was well-supplied with crude. Namely, prices were going firmly against market fundamentals. Then, when the bubble burst oil prices fell sharply.