OPEC Signals U.S. Rally

The
headlines stating that OPEC President Chakib Khelil believes oil could
hit $200 a barrel are completely misleading.<!--more--> What he’s really doing is
posturing the US Federal Reserve to stop cutting rates because the low
dollar is killing the rest of the world. The real theme from his
comments are that oil supply levels are great, in fact, he said that US
gasoline inventories are at 5 year highs with easing demand.

"The
prices are high due to the fact of the recession in the United States
and the economic crisis which has touched several countries, a
situation which has an effect on the devaluation of the dollar, and
therefore each time the dollar falls one percent, the price of the
barrel rises by $4, and of course vice versa," Khelil was quoted as
saying in brief remarks to journalists on Sunday. "If this [the dollar]
strengthens by 10 percent, it is probable that [oil] prices will fall
by 40 percent."