Phil Flynn: The Audacity Of Hope

If the economy bounces back and the Chinese hang onto their Euros, can oil bulls find love and happiness in this world of economic turmoil? The audacity of hope once again has crept back into the oil market. A string of strong macroeconomic numbers that blew away market expectations, as well as some strong oil demand numbers, has the marketplace trying to forget all about the fears of a global economic meltdown that has engulfed the market. For today all the subplots have been put aside for the moment as the market now wants to bask in the economic silver linings of the moment.

You know you are going to have a good day when you get a report that shows refinancings are rising and housing sales of new homes surged 14.8%. Add to that a strong durable goods number that gained 2.9 percent in April, the fourth boost in the last five months, and somehow the world is not so scary. Oh sure the Europeans have problems as evidenced by rumors that the Chinese were looking to divest themselves from Euros and it seems that the world's largest oil consumer, the USA, might lead the oil market out of its recent darkness.

That mood was further cemented when the Energy Information Agency released a report that showed some stellar oil demand numbers. Despite the fact that the EIA reported that US commercial crude oil inventories increased by 2.4 million barrels from the previous week, they also reported that the string of increases at the key delivery pinpoint Cushing, Oklahoma actually fell from its record high. Along with that the EIA reported demand numbers that....Read the entire article.

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