Russian gas deal, Gaza ceasefire ease supply concerns… World oil demand expected to fall in 2009… U.S. holiday leads to low trading volumes…

Oil fell more than $2 towards $34 a barrel on Monday after Russia and Ukraine signed a 10-year gas deal clearing the way for the resumption of supplies to a freezing Europe.

Implementation of a ceasefire between Israel and Hamas in Gaza also eased supply concerns as the market remained under pressure from expectations that the weakening global economy would erode oil demand.

“Right now the economy is dominating,” said Harry Tchilinguirian, analyst at BNP Paribas. “The market is very volatile and the signs are that demand is weakening.”

U.S. crude oil futures for February delivery dipped to a low of $33.89, down $2.62, before recovering to trade at $34.53 by 1800 GMT.

Traders said the February U.S. crude oil futures

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Goosing infrastructure companies isn’t anything new. It’s been going on since 2003, when the U.S.’ “shock and awe” offensive overwhelmed Iraqi forces and resulted in negligible casualties. It was too easy. The casualties came later.

Two things will define 2009. One is the huge $1 trillion economic stimulus package featuring “smart grids,” roads and bridges.

The other is the winding down of the war in Iraq. I believe that this will supersede handling the aftermath of the current eruption of violence between Israel and Hamas in the Gaza Strip.

The promise of ending the war helped President-Elect Obama get elected, though I believe the policy differences between the two presidential candidates were not as great as generally perceived.

Now Iran and Afghanistan are Obama’s problem. It’s not quite as urgent as the deteriorating state of the economy, but it’s close. Obama will begin withdrawing troops as soon as he can. That may

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In the energy market on Wednesday, oil plummeted to the biggest one-day percentage loss in 7 years, with crude for February delivery closing at $42.63/barrel, down $5.95. February reformulated gasoline fell 11.28 cents, to $1.0764/gallon.

In its weekly inventory survey, the Energy Information Administration reported that the nation’s crude stocks shot up by 6.7 million barrels in the week ended January 2. Gasoline inventories increased 3.3 million barrels, while distillate stocks rose by 1.8 million barrels. Refineries were operating at 84.6% of capacity last week, up from the prior week’s 82.5%.

“The stock build should be enough to chase the bulls back into the barn,” said James Williams, of WTRG Economics. “The substantial builds in crude oil, gasoline and distillates ought to bring the bears back from a short hibernation.”

Also helping oil lower was an easing of Middle East tensions after reports of a temporary truce in the Gaza Strip to

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Borders Ousts CEO; Front Page Ads in New York Times; Steve Jobs Speaks, Apple Soars; U.K. Short Selling Ban Ending; Whitman’s Future; Oil Rises on MidEast Violence; Russia Cuts Gas Supplies to Europe

Borders Group, Inc. (BGP) ousted its Chief Executive George Jones and replaced him with outsider Ron Marshall, a Wildridge Capital Management executive whose primary experience is turning around ailing companies, Reuters reported. George had been Borders’ CEO for the past three years. The New York Times Co. (NYT) opened its front page to advertisers, a controversial move within journalism circles but also one that follows ...

Dollar rises to 3-week high vs euro on stimulus hopes… Oil prices fail to hold gains above $48 a barrel…  Abu Dhabi Dec gold sales fall 40 pct month on month.

Gold slid more than 3 percent in Europe on Monday as the strengthening dollar knocked the metal’s appeal as a currency hedge, and oil prices retreated from highs.

Other precious metals tumbled in gold’s wake, with silver falling 8 percent, platinum 3 percent and palladium 6 percent.

Spot gold was quoted at $851.65/853.65 an ounce at 1445 GMT, down from $873.20 an ounce late in New York on Friday, having touched a session low of $843.50.

U.S. gold futures for February delivery on the COMEX division of the New York Mercantile Exchange were down $26.60 at $852.90 an ounce, having earlier touched a low of $843.50.

“The dollar is the critical factor today,”

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Gold rose in the far East, peaking at $890 in early Hong Kong trading, fell back to $875 by the close of the Comex, but rallied through the Globex to finish at $880.60/oz., up $11.90. Overnight, gold has dropped off.

Platinum pushed above $900 in Hong Kong and held above the mark all day, ending at $911/0z., up $20. Overnight, platinum has slipped lower.

Silver was in positive territory from overseas trading to the New York open, at which point it went vertical in the first half-hour, pushing past $11 to just above $11.20, but then fell sharply through the rest of the Comex before adding back a little on the Globex to close at $10.86/oz., up 20 cents. Overnight, silver is trending lower. (Click here for charts)

The precious metals started off the post-Christmas week in strong fashion, as gold especially gained off of its safe haven status in the

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Euro gains, then loses, then gains…  Inflation and Commodities…  The euro turns 10!  Risk Aversion remains but is waning… And Now… Today’s Pfennig! Remember those Wild Swings I talked about yesterday? The Wild Swings that could be a result of thin volumes in this the second week of Christmas. Well… We witnessed them in earnest yesterday! As I signed off yesterday, I told you that the euro had rallied 2 whole figures to 1.43 and change. Well, that rally dissipated throughout the morning, and by late in the day the single unit was 1.39 and change… WOW! Now that’s a Wild Swing!

You can point to profit taking as the reason for the move,

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Dow Chemical, Kuwait deal collapses… Nasdaq dragged by large-cap tech companies… Oil rises above $38 per barrel on Middle East tensions…  Dow off 1.6 pct, S&P off 1.6 pct, Nasdaq off 2.3 pct

Wall Street stumbled on Monday after a joint venture between Kuwait and Dow Chemical fell through, threatening one of the larger merger deals of the year and adding to fears about a faltering global economy.

Dow shares tumbled to their lowest since 1991 after Kuwait decided to end a $17.4 billion petrochemical joint venture amid slumping petrochemical sales and the global financial crisis.

The news ignited worries that the largest U.S. chemical company would not be able to buy rival Rohm & Haas , which Dow agreed to acquire for about $15.3 billion in July. Rohm & Haas (ROH) shares fell as much as 25 percent.

These declines were also exacerbated

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Gold was firmer on Monday, tracking a climb in crude oil prices on the back of burgeoning tensions in the Middle East, although it retreated from earlier highs as oil gave up some of its gains.

Weakness in the dollar is also supporting gold, while a slide in the value of sterling to a record low versus the euro helped to take the precious metal to a new all-time high when priced in British pounds, according to Reuters data.

Spot gold reached a session high of $889.55 an ounce, its strongest level since Oct 10, but eased to $875.20/877.20 by 1422 GMT from $866.80 late in New York on Friday.

In sterling terms, gold hit a new all-time high of 605.07 pounds an ounce, up from 592.40 pounds on Friday. U.S. gold futures for February delivery climbed $6 to $877.20.

“Gold is following

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All eyes are on the oil futures market today. As governments and industries across the globe adjust for drastically lower oil prices, investors are anxious to see how the crude market will react to the growing conflict in the Mid-East.

So far today, crude prices have jumped by near double-digit proportions, creating at least a temporary layer of support around the $40 per barrel level. As tensions increase along the Gaza Strip and Israel threatens with a strong and sustained ground attack, futures traders have all the ammunition they need to send prices higher… at least temporarily.

For fast-moving investors, the action has created a trading opportunity. Shares of the world’s largest oil producers opened higher thanks to a jump in crude prices. Exxon Mobil (NYSE:XOM) is up by just under two percent. Chevron (NYSE:CVX) and BP (NYSE:BP) are up by similar proportions.

A move of one

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