MUMBAI (Commodity Online): Crude oil price that is hovering above $75 is no longer be at that level and is likely to drop to early 2009 price range by the end of this year when the US government takes back the stimulus efforts, reported Dow Jones Newswire citing an Energy expert.

Addressing a midyear Dow Jones Indexes-UBS commodity outlook conference, Phil Flynn, analyst for PFGBest said that the US economic policies artificially inflated crude oil prices by $20 to $30 per barrel.

Crude Oil prices are likely to be $40 a barrel by the end of this year or be in a $44-$49 range, Flynn said.

Flynn attributed the surge in crude oil prices to the Federal Reserve’s interest rates. He said when Fed raises the interest rates the crude oil prices too rise in tandem with it as investors see it as a sign the economy is on the mend.

But, this would lead to a bearish crude oil market when traders recognize that the pull-back of stimulus will strengthen the dollar, weighing pressure on crude oil prices, he added.

Crude prices climbed close to $150 in 2008. Flynn said that rally was a sign of trouble in the economy, and that investors started to buy crude as a hedge against bank failures, which they expected to hammer the U.S. economy while sparing global markets.

Analysts were less bearish on other commodities. Matt Zeman, a commodity futures broker with La Salle Futures Group, said that "financial mayhem" will continue to fuel prices in gold, which he said has become an alternative currency.

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