Warm Weather Driving Down Crude and Oil Stocks

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Includes: OIH, USO
by: Eddy Elfenbein

Eddy Elfenbein submits: It's another balmy day here in our nation's capital. The Post said it's going to get up to 63 today. The cherry blossoms in my backyard are out about three months ahead of schedule.

Warm weather is bursting out all across the East Coast. Barry Ritholtz said that he rolled top down the other day.

The warm weather is also having a big impact on the financial markets. Oil is down again today. The latest quote shows oil off $2.73 to $55.59 a barrel.

(By the way, whatever happened to the Goldman/Paulson/Oil plot to lower gas prices before the election? I thought that prices were supposed to go right back up.)

Here's the February contract for light sweet crude:

crude

Oh Seven is not being kind to energy stocks. In just two days, the Dow Oil & Gas Index (^DJUSEN) has dropped 5.7% while the S&P 500 is flat. (Well, it's really up 0.04 points which is 0.0028%, so let's just say it's flat.)

Crude oil is down 8.9% in the last two days, and oil is now at its lowest price since June 15, 2005. Since the July 14 high of $78.40, oil is down 29%. Even in euros, oil is down!

oil and gas index