As you no doubt know, the world’s oil producers dropped a little price on the US of A and decided to turn of the spigot (partly, at least) to their production, thus causing crude oil to instantly rocket higher. As of this moment, which is a mere half hour into the futures trading day, oil is up almost 8%.
Think about that for a moment. We all wait with a lump in our throat as to whether MONTHLY inflation will come in at 0.4% or 0.3%, and yet in an INSTANT oil has roared higher by twenty times that amount. Think this’ll help inflation out? How about airlines and trucking companies? Or the economy in general?
As nice as it is (for the MOMENT at least) to see equity futures lower, I’ve got to say, this is Bad news with a capital “B” for me, because I’m long puts on six different energy companies. I am not sure if a single one of those will survive the first half hour of trading in the morning. In a stroke, the oil cartel has probably destroyed my entire energy bear stance, because this right triangle top has been blown to smithereens. What a shame!
It’s going to be awfully interesting to see what Monday morning looks like. This is going to be one hell of a week, and it’s already got a big surprise to kick things off.
