The energy markets were choppy overnight, finding some support from stronger equity markets and a weaker dollar but under pressure from ideas that a Libyan rebel victory would eventually help improve oil flow from that country. Ironically, Libya is one of the lead stories in the financial market coverage this morning, and the almost imminent demise of the Gaddafi regime appears to be having a hand in the overnight economic optimism. There also seemed to be some hope/anticipation building overnight that the Fed could announce an extension of quantitative easing at this weekend's meeting in Jackson Hole. That prospect is still being dismissed as highly unlikely by many observers. In the oil markets overnight, Brent was down more than $2 per barrel at one point, while WTI traded higher. This allowed for a correction in the Brent/WTI spread, which had moved to historically wide levels. The weakness in the Brent market was mostly due to the Libyan story, although some observers still fretted over European consumption. European refiners are the primary users of Libyan crude, and the Brent price is used as a benchmark for Libyan crude oil. Hurricane Irene is expected to tack over the eastern coast of Florida and not affect drilling or refining activity in the Gulf. API data last week showed US crude oil demand in July was down 0.5% from a year ago, the first monthly decline this year. The Commitments of Traders Report as of August 16th showed non-commercial traders were net long 176,484 contracts in crude oil as of August 16ht, a decrease of 2,509 contracts for the week. Non-commercial and non-reportable traders combined held a net long position of 190,253 contracts in crude oil, a decrease of 26,709 contracts. This data indicates that market is far from overbought, but the selling trend on the part of speculators is a short term negative. It appears that WTI crude will be looking to the general economy for direction today, with the stock market taking the lead. Brent will be watching Libya.