What the Economy Is Telling Me About Oil PricesPop1136 views 2013-07-22 02:18 Tags: continue blank believe driving unusual
Oil pricescontinue to edge higher on the chart, and that’s pushing the cost of gasoline higher at the pumps.
Now, while U.S. crude inventories have risen over the past two weeks, I do not believe there’s a supply-demand issue that is propping it up. I believe the demand for oil has more to do with the summer driving season and other unusual factors, not a sustained upward move in oil prices.
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I also believe that oil traders are reacting more to headlines than the underlying fundamentals of the market. For example, a strong initial claim reading last Thursday drove up optimism that the economy is improving, but the real truth is the economy is stalling.
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