By CHRIS KAHN
AP Energy Writer
(AP:NEW YORK) The price of oil is rising on hopes that the Federal Reserve will announce new measures to stimulate the U.S. economy.
U.S. West Texas Intermediate crude rose by 79 cents to $84.06 per barrel. Brent crude, which helps set the price for oil imported into the U.S., added 4 cents to $96.09.
The Fed holds a two-day meeting that ends Wednesday, and in the past it has taken action to encourage Americans to spend and borrow. Many analysts think the struggles of the U.S. economy and Europe's debt crisis will compel the Fed to say or unveil something to try to boost confidence.
Any sign that the Fed is willing to take action could lift oil prices, which have fallen sharply during the past six weeks over fears that growth in the global economy will stall.
"The market is building on a little optimism that they'll do something," said Peter Donovan, an oil broker with Vantage Trading in New York.
Concerns about Iran's nuclear program also are pushing oil prices higher, Donovan said. Negotiations between six world powers and Iran _ a huge oil producer _ appear to have accomplished little this week in Moscow. That increases the likelihood of a European oil embargo in July. And some analysts are concerned the matter will only be settled by an armed conflict in the Middle East.
Either action _ an embargo or an attack on Iran _ could cut into the world's supply of oil.
Even before its sudden drop, the price of oil had declined from a high this year of $109.77 on February 24.
Gasoline prices continue to follow oil lower. On Tuesday, the national average fell below $3.50 per gallon for the first time since Feb. 10, according to auto club AAA, Wright Express and Oil Price Information Service. The average price of gasoline in the U.S. has dropped 44 cents since peaking at $3.94 in early April. Along with the impact of lower crude prices, there's a greater supply of gasoline. Refineries tend to increase stockpiles of summer gasoline after Memorial Day.
In other futures trading, heating oil added 2.2 cents to $2.64 per gallon while wholesale gasoline fell by 1.2 cents to $2.649 per gallon. Natural gas lost 5.2 cents to $2.583 per 1,000 cubic feet.
Couple of things: 1) The concept that oil prices should rise because of more Fed action in buying more of our own debt is insanity, when all things are considered. The idea, of course, is that a QE3 will stimulate the economy and people will suddenly be rolling in the bucks to take those long-awaited vacations they couldn't afford for the past 3 years. Well, if they've been laid off for 3 years(like me) due to stupid actions by Congress and the President's deliberate "No Jobs, No Way" program, we ain't gonin' no where no time on no gas. Duh! I have said for over 3 years, this President wants to destroy America (he's on record on national TV admitting he has always "hated America"...as did his dead worthless Kenyan Daddy (which, of itself makes him Constitutionally ineligible to serve even if he was born on the White House LAWN. The dollar is to be destroyed. It only still "appears" healthy when compared to the faster declining Euro which is declining because a number of European nations have done on a smaller scale what we have been doing. Follow the math. Learn from history. So, what have the prior stimuluses done for us OTHER THAN protect banks from having to pay a price for acting and investing irresponsibly while average Americans DO pay the price? In the end, another dreaded QE whatever will further destroy the value of the dollar. Now, the MAIN reason oil is at current prices (in the $ 80+/barrel range) is because of Petro Dollar pricing and, as the purchasing value of the dollar declines, oil prices will INCREASE. It is a LIE from hell to say that a QE3 "stimulus" from the Fed will raise oil prices due to an improved economy. Prices will rise because it will take more fiat dollars to buy the same amount of the same commodity. PERIOD. And, they know it, but we have a communist in the White House because Americans' personal knowledge of Economics is exceeded only by an earth worm's penchant for eating DIRT. In the private sector, if you come up with a new scheme, you game it. You really discuss it. You build "models" to check it out and then, if it holds up, you test it. Once you implement it, you monitor its performance to see if it measures up to expectations. Often, even moderately successful programs are scuttled because they didn't hit expectations. The Federal Reserve was conceived in secrecy by powerful globalist bankers. they PROMISED Congress and the people that IF they would approve and institute "a Central Bank", the following would be assured: a) a stabile dollar (that means solid purchasing power, long-term) b) A "Depression" would be virtually impossible to ever again occur c) recessions would be rare, mild, and short d) Stock market crashes would be a thing of the past. So: after 98 1/2 years, HOW IS THAT WORKING?
a) The purchasing value of a dollar has declined by 99%. It now costs $ 1.00 to purchase what a penny purchased in 1913. b) What was that "thing" or 10 year long "era" between 1931 and 1941 called again? Oh yeah, "The Great Depression". hmmmm (can't happen) c) How many Recessions, those "R" words have we had? Hard to count. Oh, we had a succession of them in the lates 80s to mid 80's and, hmmmm, far from being short and shallow and nearly impossible, they all were steep, severe, and not short AND they all had one other thing in common: They were DELIBERATELY created by THE FED (whose existence was to render them nigh impossible) Oh, but WHO remembers? and finally d) hmmm. got to check the timeline on this: passed the bill IN SECRECY only after Congress waited for the opposition to leave on Christmas Holiday in 1913. Then, they ran secretly back, went into session, passed the Federal Reserve Act with the majority of Congress (the opposition) on holiday and without notice of the vote....one might ask where the Supreme Court was allowing THAT? and it was quickly signed into law by the Progressive President Wilson. That was 1913. As memory serves, 1929 (you know...the year of THE STOCK MARKET CRASH) CAME AFTER 1913, at least on my calendars....but how could that be? Stock Market Crashes would be nearly impossible too, remember? Even his Majesty "The Destroyer' Ben Bernanke recently admitted that it was "the actions of the Federal Reserve that caused the speculative "bubble" in the '20's stock market that led to the crash, and further actions by The Fed that turned it into the Great Depression". How's that working for you so far? Then there was the Crash of 1987 and the Crash of 2000....I was a stock broker for each of those but then, HEH, they never could've happened could they? So, where did a million of my money and trillions of others go? Makes you wonder.....or it SHOULD. So, our Central Bank, conceived by financial whores in the night, behind closed doors, in secrecy, approved after the majority of our duly elected officials were escorted out of town, by the minority of supporters, comprised of PRIVATE greedy bankers with their own agenda, CHARTERED OFFSHORE, but given permission to PRINT OUR MONEY, and which, through abuse and never attempting to live up to the hype used to "sell it", has NEVER lived up to any of its promises....but no one attempts to get rid of it and only Ron Paul was successful in pushing for and getting a PARTIAL audit in 2011 which revealed what the criminal Bernanke in charge had refused, under oath, before Congress to reveal....that he had printed and GIVEN trillions of dollars to mostly FOREIGN BANKS. And now we have a positive stock market reaction to the thought that he would buy more of our debt....and oil prices rose....indeed, for the WRONG, counter-productive reasoning. I do hope you are buying gold and silver and, if not, at least go to ACE and pick up a wheelbarrow. You will need one, as the Germans in the Weimar Republic learned, in order to carry enough worthless paper currency to the store....to buy.....a single.....loaf of bread.....when available. It's coming. But what do I know? I'm an Economist, Certified Financial Planner, 20th century historian, and Political Analyst with decades of experience, hours of daily study, and a list of highly accurate predictions and Americans in general? none of these credentials....which is why they voted a communist street organizer with no real work experience and who only ran his MOUTH, not a business into the highest office in the world because he promised CHANGE and was smart to also offer the ONE THING that people on several continents throughout the 20th century have uniformly fallen for....America only being the last to do so: UNIVERSAL HEALTH CARE. Vladimir Lenin used it as the Siren Song to lure Russians into the communist revolution in 1917. Mao tse Tung used it in China in the 20's, 30's and 40's. Stalin used it in Russia and the Soviet Union, Castro used it in Cuba and even everyone's favorite man you love to hate: Adolf Hitler used it in Germany and its lure even enticed most Austrians to willingly vote for unification with Germany....all for Universal Health Care. A few years later, one might ask, with 55 million dead from WWII and 262 MILLION mostly civilians killed by governments in the 20th century, HOW'S THAT WORKING FOR YOU? America rejoice....in your soon to come demise. Like Barnum said, "A sucker born every minute"....and that gave us the Obama Administraion....when Socialism just isn't enough and when it's time to trash that restrictive Constitution. Are you ready for the man who would be dictator? He's here, and it isn't Romney.
Wow William, that a lot of history and fact. Good read!
I think All the same markets are going to tank. I am short at the ver high of the day. Short Short Short. Honoring my stops of course. But I am short now big time. If market continues up tomorrow then I will be taken out of the market. All the same markets means in a Deflationary Bear Market Depression it does not matter the value of everything will go down including Gold and Treasuries. Treasuries will go down the slowest. Here is the only thing that will go up in value. The fisical DOLLAR because everything else will be cut in value the dollar will purchase more. So take all your money out of the banks and stuff dollars in a safe because they will buy a whole lot more when this fiat money system breaks down.
good trade at the upper B-Band, consider GDX puts
Thanks Dennis I will check it out.
The idea of a war with Iran over the development of nuclear weapons is so stupid we would have to bring Bush and Cheney back to lead the effort. India, Pakistan, Israel, S. Africa and N. Korea all developed such weapons without our approval, and only N. Korea has blustered and we reacted.
In five years we will realize has awash the world is in gas and oil.
Have fun.
I wonder if Israel would collaborate with the US, or even notify them if they decide to attack Iran, given the Obama leaks of National Security secrets.
I think that Gas prices were heading in right direction.
now if all other consumer goods could do the same you might be doing something
Now if one could get a decent intrest on savings. or investments. the people in wa-
-shington could rase intrest to at least (3)% on all especially to banks, and large instutions
Maybe the Economy could Grow. Also if we could get Governement regulations stoped
or frozen we could becom a good nation again.