Sharky,

I agree there is not the same feeling in Europe as in the US. It will take 100 years to get to that position with a real feeling of one country with several federal states (countries). I don’t hold out much hope of the leaders banding together and making the decisions which are necessary to pull Europe through this crisis. I remember once there was some argument within the European Commission about the curvature of a banana. I am not joking now, this is how we are working in Europe. A sad state of affairs to be sure.

I would not like to predict where oil is going as I firmly believed some time ago that oil would go to $200 within 2 years from +100. Look where we are now. The only thing I can do is try to make some observations.

1.) Price action during the week may just be early signs of a recovery, probably only a slight one.

2.) Super Contango which existed before has contracted and the Spot and April got back to normal levels.

3.) US inventories showed a drop, first time in seven weeks.

4.) The steep down trend we have seen appears to be abating.

5.) Seems to me the decisive levels are around $32 (sup) and $41 (res) for now. We will need to decisively break above the $41 and sustain for a decent period before we can see any further upside.

Note: I am talking about WTI here not WCS Hardisty bitumen which does not have a precise correlation.

If I had to predict a price I would have to say average WTI for 2009 to be $50 plus/min. That means it will have to get to $60 at some time during the year. Not a great average for CLL and hopefully 2010 will be better as the effects of the crisis lessen.

Lynn,

Thanks for the chart and it certainly looks like China are turning a corner. Thing is I am not sure how that will lead anyone out of recession except China as they are a net exporter. I do concede however that China demand will be good for the price of oil which for CLL the singular most important thing. One thing I do agree with is your perception of analysts and their useless predictions. Oops my prediction will probably turn out to be just as useless.

Anyway hope you guys had a great weekend

Den