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In the last 48 hours oil has dropped over $8 per barrel. I didn't check the exact drop but gasoline has dropped between 15 cents and 20 cents per gallon.
Then right after the close what pops up on the wires but a puff piece from JP Morgan saying oil will not drop below $130 a barrel this summer.
Excuse me but weren't the guys at a competing bank saying we would see $150 plus by August. I wonder how many call contracts these bankers are sitting on at the moment. If oil futures dump to $100 a barrel, someone is going to take a major bath.
JPMorgan Says Oil to Remain Above $130 a Barrel Through Summer
By Robert Tuttle
July 8 (Bloomberg) -- Oil prices will remain above $130 a barrel through the end of summer and above the ``$115 level'' through the year, JPMorgan Chase & Co. analysts said in a report.
Oil rose to a record $145.85 on July 3 as global crude stockpiles, 67 million barrels below year-ago levels, have declined, the analysts said. Strife in Nigeria and concern about Iran's nuclear program have also supported oil's climb, while Saudi Arabia's pledge last month to increase oil production was ``modest,'' the analysts said.
``With the $150 in easy reach and a significant number of outstanding August WTI call options at that strike price, it seems almost a certainty ahead of the July 22 expiry,'' analysts Scott Speaker, Mark Gravener, Sung Yoo and Kristi Jones said in a report released yesterday.
Oil for August delivery fell $5.12, or 3.6 percent, to $136.25 a barrel at 2:20 p.m. on the New York Mercantile Exchange today. The contract for August delivery expires on July 22.
``We will likely see some minor corrections in the interim,'' the analysts said.
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