Traders put panic aside and decided to seek value as oil made a marvelous comeback. We tried to tell you! Yet despite the recent drive of optimism can crude continue to flourish as problems in the Euro zone continue to evolve will oil set back after this incredible run? Germany disappointed oil bulls with a domestic product growth reading that slowed more than expected in the second quarter, dropping to 0.1 percent in seasonally adjusted terms from a revised 1.3 percent in the first three months of the year. Germany the strength of the Euro zone is meeting With France for a solution to save members of other Euro Sates as domestic opposition for bailing out other countries continues to grow. A weak GDP reading may make it even more difficult to take the steps that are necessary to bailout the like of Greece and others. The Talk of a Euro Bond that is supposedly not on the table at this meeting may be the only tool to save the PIIGS that have gone astray. By making the whole zone responsible for the debts of all nations the member countries can have more say in the spending that comes from the overspending underperforming PIIGS. Yet the political will in places like Germany may weaken as their economy slips.

Still here in the US it looks like demand for oil has improved slightly. We saw a big drop in gasoline prices and that seems to have stopped the trend of falling demand. We should see a rebound in gas demand and we should also see that lead to a drop in Crude, gas and distillate inventories in this week's report. Be on guard for a big drop in crude supply.

President Obama's week just keeps getting worse. First his health care provision that would force people to buy insurance was declared unconstitutional now his drilling was regulatory overreach has been stuck down by a court The Wall Street Journal Reports that "A federal judge has struck down an Obama administration policy concerning drilling on public lands, raising the possibility that more permits will be issued for oil and gas companies. But it wasn't clear Monday how the Interior Department, which processes the permits, would respond. The ruling, issued Friday by the U.S. District Court in Wyoming, rejected a policy that had required more extensive environmental review of some drilling permits. The Interior Department "had no authority" to adopt the policy last year "without public notice and an opportunity for comment," Judge Nancy D. Freudenthal wrote. She ruled in favor of an industry group and vacated the policy nationwide. An Interior Department spokesman said the agency was reviewing the ruling and declined to comment further."

The story that I thought would be getting more play is the Shell oil leak in the North Sea. The spill in the Garnet field is causing some volatility in the Brent WTI spread. The unreliability of North Sea production as well as the ongoing conflicts in Libya and other nations have kept the Brent Crude strong.

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