ANOTHER DAY, ANOTHER VIEW

Investors misgivings about a faltering US economy, suggested by Friday's jobs report, seem to have been more than offset by renewed supply concerns.

Comments from OPEC saying the market is well supplied seemed to provide support to crude oil overnight despite the dollar holding firm.

Actually, OPEC seaborne oil exports fell 100k bpd in the four weeks to March 23rd, mostly from Gulf producers. The odds for another cut in interest rate cut would appear to have risen by the combination of Bernanke's warning last week of a possible recession and March payrolls falling more than expected.

Some of the gains must be attributed to continuing investor interest in holding physical commodities as a hedge against inflation, which looks to continue with the combination of a weaker dollar and a lower interest rate outlook.

News of a major fire shutting down a Los Angeles area refinery raised product supply concerns Friday that seemed to support gains across the complex. The Commitments report shows the market  has shed a portion of the length that had built up, so technically, the market has some additional buying power.

The series of declining highs since the March17th high has been reversed by today's price action, so far. Still, crude prices remain within a large consolidation range between $100 and $110.

There must necessarily be some misgivings the market will be able to sustain a move back to and above the recent highs, given the deteriorating economy and its ability to generate energy demand growth. These concerns must periodically keep bullish sentiment, as well as prices, in check.

M. Fitzpatrick