Do you remember this time last year? As spring turned to summer, energy prices were moving upward. By mid-July 2008, oil prices peaked at $147 per barrel. But as with Gen. Pickett and his famous charge at Gettysburg, that lofty level of $147 was the high-water mark for oil prices.

By August of last year, the price of oil was retreating, and it was a hard slog on the way down. By midwinter, in December 2008 and January 2009, oil prices were in the $30s per barrel - a drop of over 75% within six months. It was a wild ride.

Natural gas had a similar rise and fall last year. In July 2008, the NYMEX price for natural gas was around $13 per mcf (thousand cubic feet). By October 2008, that price was cut in half. In fact, natural gas prices trended down throughout the chilly winter of 2008-2009. The current

...

In the energy market on Friday, crude for August delivery slipped, closing at $69.16/barrel, down $1.07. July reformulated gasoline lost 2.42 cents, to $1.8741/gallon. Crude wrapped up its second straight week of decline, as traders seem to have turned sour on the prospects of recovering global demand. For the month, however, oil is still up more than 3%.

“The latest oil price increase to over $70 a barrel is not justified by current fundamentals, [although] it cannot be ignored that the oil market has improved,” wrote analysts at Commerzbank. “The underlying demand remains week.”

In a potentially positive development the Movement for the Emancipation of the Niger Delta, or MEND, say they are studying an amnesty offer announced by Nigerian President Umaru Yar’Adua, but will turn in their heavy weapons by the August 4th deadline stipulated in the document.

The group, however, objects to the term “amnesty,” saying that, “We are

...

In the energy market on Friday, crude for June delivery fell back, closing at $56.34/barrel, down $2.28. June reformulated gasoline dropped 4.31 cents, to $1.6806/gallon.

Friday’s result left crude down by 3.9% on the week, following a 10% rally the week before.

After reports that OPEC ratcheted up oil production in April, the first month in eight in which the cartel has increased output, Commerzbank analysts commented that, “Rising oil prices increase the incentive to expand production at the expense of other oil producers, in order to benefit from higher oil prices.”

“A weaker demand and higher OPEC supply may explain why oil stocks have been rising until recently,” the bank’s analysts added. “This also confirms our conviction that the oil price increase during the last weeks was overdone and a price correction toward $55 a barrel had to be expected.”

And natgas followed last week’s sharp gains with equally

...

The Federal Reserve can't be entirely pleased with markets' reaction to its announcement on Wednesday of quantitative goals for purchases of long-term assets.

The Fed's objective in this quantitative easing is to move the inflation rate back into positive territory. Let's begin by reviewing the new consumer price index data that were also released on Wednesday by the Bureau of Labor Statistics. These numbers show further modest movement away from a deflationary tendency prior to any actions by the Fed. The seasonally adjusted February CPI was 0.4% higher than in January, which would be a 4.8% annual inflation rate if sustained for a year. Although that's plenty for one month, it nevertheless is still substantially smaller in absolute value than the drops seen in October through December.

Month-to-month percent change (monthly rate) in seasonally adjusted headline CPI. Data ...