Phil Flynn is the pit trader at the NYMEX who reports on the oil trade for CNBC and Fox Business (like Santelli does for T-Bonds).
This whole thing with the Fed and Banana Ben is becoming a joke. Just like our country is becoming a joke with "Bubbles" Ben being named "Man of the Year" by Time magazine.
It's not being named "Man of the Year" that's so bad, as Don pointed out, but the pathetic fawning over this bankster stooge.

(*Highlites are mine)

The Energy Report

by Phil Flynn

Oil Is Fed UP

Oil is FED Up.
Oil finally got up off the mat, ignored a soaring dollar and it got lifted in a bout of demand optimism off a better than expected industrial production number. Ok it helped that the market was oversold and the session was less than exciting, yet the rally still seems to suggest that the market may still have some life or maybe just some short covering ahead of the Fed.
And why should it not? The price of oil is a Fed inspired creation with a recipe of zero interest rates and printed money and the type of demand growth that can only be inspired by cheap and easy money. Yesterday the market was worried by a larger jump in wholesale inflation when the PPI came out triple expectations, rising 1.8%. That led some in the oil patch to wonder whether the Fed is too complacent and this is the precipice of a major inflationary cycle. We saw note yield hit the highest level since August on those concerns and the Fed statement may be the most important single factor that drives oil prices around today. But more importantly it may perhaps give us a window into the next big move when it comes to energy prices.
Once oil closed back below $75 a barrel I told you we would be in a trading range that eventually would bring us down to $65. The Fed may overshadow even today’s inventory report that will be heavily influenced by the cold. The API reported a big drop in distillate fuels as supply fell 2.604 million barrels as those heaters are starting to go on. Crude stocks actually increased by 924, 00 barrels as the AOI reported a surprising drop in crude runs. Gasoline stocks increased by 2.074 million barrels. With without much overhead short-term resistance the market decided to take the mixed report as slightly bullish overnight or perhaps it is just ignoring it and moving higher technically.
Now despite current strength oil will have a hard time rallying too hard as it is clear that we will see more oil production out of OPEC. As OPEC meets it will not matter whether or not they change their quota, with their compliance already slipping to a new yearly low, we would expect to see more OPEC oil come onto the market.

Natural Gas Breakout! It looks like natural gas in January will target 590 to 600! Stay warm as you put up that tree and bake those cookies!
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It Is Fed day! Get your Fed shoes out and turn on the only place to get the Fed decision and that is the Fox Business Network where you can see me every day!