Oil's year-to-date rally defies declining demand

[Crewleader]

Jul 21, 2009, 1:34 p.m. EST

Oil's year-to-date rally defies declining demand
Commodity gains 50% this year, in spite of 19-year high in U.S. stockpiles

Declining demand in the U.S., the world's biggest oil consumer, has pushed up total inventories of crude oil, gasoline, and other petroleum products to the highest level in 19 years, an analysis of energy data showed. U.S. demand in the first half of 2009 was the weakest in a decade, while global consumption fell in the second quarter to the lowest level in four years.

The increasingly bearish fundamentals are raising concerns over the rally in oil prices. While some analysts say oil's gain was helped by hopes for an economic recovery, others believe it's speculation that has pushed oil higher, and a major correction could pull prices back to around $50 a barrel.

Trading patterns in oil futures, jumping to almost $150 a barrel last year, only to fall back to below $40 this spring before rising again to $70, have raised alerts in the Obama administration, which is preparing new rules to curb exotic derivative trading in financial markets.



http://www.marketwatch.com/story/oil-rises-despite-declining-demand

[Hydra]

1. Unless it keeps being artificially inflated

I suspect a crash is right around the corner.

[Double T]

2. Got to love wall street's energy market manipulation and the fact supply and demand........

has been totally GD IGNORED by these swindling criminals. The American people continue to sleep while getting screwed every time they stick the gas nozzle in their tank. Ken Lay may be in a 'bush/cheney criminal friends of the former WH protection program', but Enron trading lives on. Yep, it sure is business as usual while our congress looks the other way and prepares for their summer recess. WE need more fire extinguishers over here; Rome continues to burn.

[Historic NY]

3. Were being played like violins..by Wall St & the Oil companies...

the government isn't doing Jack to stop it either. Its obvious the speculation is still going on.

[pinb1212]

4. Im disappointed

We have the House the Senate and the Pres. If they don't stop it.... who will?

[excess_3]

5. the selloff was overdone. /n/t