$77 Crude?

We have been focusing, over the past few months, on the credit contraction issue, and what this means to the markets. The recent weakness (Thursday and Tuesday) were very much Credit related.

However, we should not ignore the impact of the rising price of Crude Oil.

As of Wednesday's close,
Crude oil  was $76.24 a barrel. That price came after three days of losses, reversed by falling U.S. crude stockpiles in the U.S.

As I type this, Crude is a hair under $77.

Futures: The front-month September light, sweet crude contract on the NY Mercantile closed settled up at $2.32 -- a 3.2% gain -- at $75.88 a barrel. This was "just shy of the 11-month closing high of $75.92 reached July 19."

The good news for motorists was reported by the WSJ: "Gasoline stockpiles rose by 800,000 barrels amid the highest-ever weekly gasoline imports. That compared with expectations of a 510,000-barrel gain. Distillates, which include heating oil and diesel, increased by 1.5 million barrels, twice as much as was forecast in a Dow Jones Newswires poll of market participants."

Source:
Crude Jumps to Almost $76
Futures Leap 3.2% As Stockpile Falls At Key Storage Hub
MATT CHAMBERS
WSJ, July 26, 2007; Page C6
http://online.wsj.com/article/SB118537163781177567.html

Comments

[erniem:]

Crude prices as much reflect complete uncertainty about supply as they do supply. If Israel or the US makes an airstrike against Iranian nuclear centrifuge facilities, $78 crude will be the cheapest price for months.

2007 Jul 26 12:07 PM