Crude Oil Prices

A look at crude oil prices and what effect they are having on the economy.

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Monday, May 19, 2008

Oil prices once again hit a new record high

Oil priced climbed 76 cents today to settle as another new closing record of $127.05.  The first time oil has closed above $127 a barrel.  At one point today prices rallied to within 5 cents of Friday's intraday record.  Prices didn't manage to go above Friday's record though.
 
Gas prices continued to climb higher over the weekend at the pump, now up to a nationwide average of $3.79.  Gasoline futures today managed to climb once again today, up 1.31 cents to settle at $3.2366 a gallon.
 
Diesel fuel also climbed to another new record $4.52 a gallon nationwide.  Heating oil future fell 2.77 to $3.6751 a gallon on the New York Mercantile Exchange.
 
Today President Bush signed a bill that forces his administration to temporarily stop buying oil to fill the Strategic Petroleum Reserve.  Bush signed the measure without comment.  The Senate passed the bill last week by a 97-1 margin and the House passed the by a 385-25 margin.  It was believed a veto could be easily overridden.
 
Holly Corp. said a key uint at it New Mexico refinery was shut down for repairs, cutting estimated May gasoline production by 756,000 gallons per day.  This outage wasn't expected to significantly affect fuel prices.
 
Oil prices jumped on a report OPEC would not increse production before its next meeting September 9th.
 
Kazakhstan banned the export of all refined oil products, news agencies reported today.  The energy-righ Central Asian nation is grappling with soaring fuel costs.
 
Relative strength continued to climb now at 72%.  The 20-day moving average also climbed higher now up to $120.71.  The 50-day moving average is now at $112.52.
 
Volume dropped almost 100,000 contracts from Friday, with 147,057 contracts being traded today on the June contract.  Open interest also dropped down to 83,099 open contracts.  The final day of trading for the June contract is just around the corner.  The trading in all contracts was down just over 1,000 contracts.  The open interest in all months climbed by 25,000 contracts, roughly, to 5,515,598 open contracts.
 
The inability of the contract to make a new high today makes me think we have put in a short term top.  Closing near the top end of the trading range makes me think we also have put in a short term top.  I would be looking for lower prices over the next several days with prices moving down toward the 20-day moving average.