Crude Oil Heading For Another Religious Experience?

Crude oil is steady at around half a dollar higher in early trade this morning ahead of key stocks data due to be released at 15.30 GMT by the US Energy Dept.

The figures are expected to show US crude inventories rising for the 11th straight week, the first time that has happened since 2004.

The American Petroleum Institute yesterday said that US crude stocks rose by 1.41 million barrels last week, gasoline inventories also rose - by 1.6 million barrels - contrary top expectations of a 1.3 million barrel decrease. To bring up the round robin distillate stocks also increased too the report said.

So why are prices going up, and why is petrol at UK pumps at, or close to, record highs? Tax is of course largely responsible for the latter, the reasons for the former may be more complicated, although once again fund money seems to have a lot to do with it.

Those boys have a track record in making markets move in the opposite way to what the fundamentals dictate, at least for a time. Ultimately though the longer we buck the trend and defy logic, surely the more cataclysmic the correction appears once it comes?

It's not like we haven't seen it all before is it? One minute were at USD147, back slapping and high fives all round. The next it's USD35 and you've just got enough time to wipe the vomit off your monitor before you clear your desk and head to the Job Centre clutching a large cardboard box and a pot plant.

It's not called crude for nothing.