Hey OPEC, don't do us any favors. An ounce of prevention may be worth a pound of cure but is the talk of OPEC production cuts the wrong cure for the wrong disease?

Saudi Arabia says it is trying to do the world a favor by stabilizing the oil market but are all they doing is prolonging the globes economic pain? Yesterday oil got a little bounce on OPEC talk, Ben Bernanke saying the economy should stabilize in 2009, Russia and Ukraine defiance and, oh yes, a freaking ice age. But it was really OPEC that gave us a bounce as the cartel once again showed indifference to the economic health of the rest of the world.

Ali al-Naimi the Saudi Oil Minister stirred up trouble by declaring that Saudi Arabia will produce less than its agreed quota of oil in February. Ali says that OPEC is working hard to bring the market in balance or as I see it, working hard to continue the global slowdown. Ali says that they will do what it takes to bring the market in balance and the rest of OPEC chimed in. The Saudis are reportedly producing 8 million which is down 400,000 barrels a day from last month. A lot of that decrease is because the demand for Saudi oil is not there. Overnight Dow Jones reported that Saudi Arabia's Oil Minister Ali Naimi said Wednesday that current crude oil prices are not reflective of market fundamentals and need to be maintained at a level that encourages future investments. Dow reported that Naimi said, Because of the current worldwide economic and financial downturn, prices decelerated to levels not reflective again of market fundamentals. Does this guy ever think that the market price reflects the fundamentals? Please give me a break. Ali al-Naimi is smarter than that. Does he really want to put his credibility on the line with these absurd comments? He is just trying to act like some of his other conspirator pariahs that are trying to milk the universe to make up their own shortsightedness.

Naimi is also trying to take credit for bringing down oil prices! Naimi says that cooperation between producers and consumers had helped bring down crude prices from their July highs. How Ali! By going into a recession? Come now. Naimi also says that low oil prices were aiding economic recovery, translating into a boost of purchasing power in the billions and possibly trillions of dollars for nations and individuals. And I guess he thinks that somehow he is entitled to it! Listen buddy! That so called purchasing power is not translating into demand or an economic recovery yet. Banking problems, commodity price deflation, the loss of jobs and tight credit are offsetting this so called boost in purchasing power. Ali, you are missing the point buddy!

Oil bulls have to be a bit concerned regarding reports that China is cutting gas and diesel prices. Some might think that is good for demand and long term it might be, but short term it is bearish. If the Chinese government has to encourage fuel demand then things must be pretty bad economically.

Today is option expiration for the February crude. The bulls are trying to come out of hibernation and the charts are looking like it is another turning point. Inventories should keep the pressure on the downside but a surprise draw may tip today's cap to the bulls. Still, long term oil will go back down. OPEC is helpless and there is no strong demand on the horizon except the cold weather. Stay warm and watch the Fox Business Network all day where you can see every day! And call me at 800-935-6487 to open your account and get on the Phil Flynn Energy Blast. Or email me at pflynn@alaron.com Still short crude after all these months!!!

We're short February crude on triple rollover from apprx 4461 - lower stop 4800!!!

We're long February heating oil from apprx 14900 - raise stop to 14920.

Stopped on short February RBOB from apprx 12000 at apprx 11400!!! Sell February RBOB at 12300 - stop 12500.

We're long February natural gas from apprx 520 - stop 490.

Have a GREAT day!