The enormity of the moves last week has barely sunk in as oil prices danced on the trap door of year-to-date lows to eventually finish better than from where they started. WTI improved week-on-week by $3.32/barrel (+4.52%), Brent by $2.85/barrel (+3.71%), Heating Oil by 2.12c/gallon (+0.91%), RBOB by 7.27c/gallon (+3.14%) and Gasoil by $7.50/tonne (+1.05%).
At the end of a tumultuous week, it feels as if one had blinked, one would have missed the action. Such is the relief rally in equities that whatever the Nikkei had lost it has since recovered. Are there any lessons to be learned from such roil in the market? Only that with investors in poor humour as to the plight of interest rates, overexposure to certain quarters of investment and a world that gives war signals on a daily basis, these sorts of fluxes will see repetition.
Whether oil is cheap or expensive depends on one’s view, positions, or expectations. In other words, it is relative. The same goes for the impact of the weekly statistics produced by the EIA. The perceived quality of the data is relative to the previous night’s API release, and often it is not based on the actual numbers.
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