Record increase in oil imports

Would you believe that oil imports actually rose last month? The increase also caused an increase in the U.S. Trade Deficit to $57.2 billion dollars. Contrary to what you might expect, the US bought more oil last month than the month before. Yes, you heard it right. And people who started using public transportation when the price of gas was about $4.00 per gallon continued to use public transportation to date. It seems that our large refiners were able to sniff out that a cut in Saudi production was coming so they loaded up on inventory to beat the production cuts.

Supposedly the cuts were made. Yet there are some analysts who believe that the Saudi's did not, in fact, cut production and continued to produce the oil at the same levels. There are also those who beleive that even with production cuts by OPEC that they will not be enough to drive up the price of crude oil much higher. In fact some are even predicting that the price of gas will fall to $1.25 per gallon by next spring.

OPEC meets next week. It will be interesting to see exactly what their cuts will be and what effect these cuts will have on the price of crude oil.