No, of course not. Demand is falling, the dollar is strong, Iraq and Libya are pumping qazillions of barrels, and Iran just isn’t that important, right? It’s an election year and the sky is raining double edged swords.
Only a dozen weeks ago I was reading about corporate and GDP growth, central banks were pulling the yoke hard and an upward trajectory was (nearly) assured. Demand for oil would be growing. I can’t deny the analysts and media their optimism, the argument in context was probably warranted. In my sceptical and admitedly naive mind, oil prices have less to do with supply and demand than the press conditions us to believe. Marketing, spin and speculation (isn’t hedging speculation?) aren’t given enough credit therefore might speculators be thanked if Light Sweet falls to $50? I’m sure they would be blamed if it went to $150.
It doesn’t really matter, who’s to blame or not, I just thought I’d ask the question.
It’s Friday, already.
The largest disconnects I see this morning are: an .8% decline in the EURUSD which takes us back to Monday; a 3% decline in $CL; a 2% decline in $SI but the $ES has hardly reacted. I was expecting a market reaction to the Trade Balance Numbers, interpreted as a proxy for Chinese strength/weakness and/or European strength/weakness. Nothing much happened, I guess it met expectations.