Crude Back on the Upswing
May 29th, 2008 | By Doug Casey | Category: Oil Investment & Alternative EnergyIn the energy market Wednesday, crude for July delivery rose after Tuesday’s knockdown, closing at $131.03/barrel, up $2.18. July reformulated gasoline gained 6.78 cents, to $3.4476/gallon.
“Tough talk and empty promises from Congress one day, and supply information from the Saudis another, can get a day’s relief here or there from the continued escalation of prices,” wrote Neal Ryan, of Ryan Oil & Gas Partners.
“But ultimately, prices are going to be a reflection of the supply/demand data at hand,” Ryan said.
And people are not happy about it. “The expressions of protest demonstrate how difficult social dislocation, resulting from higher fuel costs, will be,” wrote Michael Fitzpatrick of MF Global. “For the moment, though, we still feel prices look vulnerable to $120.”
Fitzpatrick argued that, on the other hand, “it has taken five years to get here; conditions will not and did not change overnight.”
Traders are looking toward the Energy Information Administration’s weekly inventory report, delayed until today by the Memorial Day holiday.
The consensus is for crude stocks to have climbed by 750,000 barrels for the week ended May 23. But as always, surprises to the up or downside could shake the market.
Source: Crude Back on the Upswing
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