The Return of $100 Crude… Gas Prices at the Pump Going Up (USO, OIL, OIH, XOP, BNO)

Europe is on the verge of suffering a debt crisis, economic data remains very choppy, and the argument is still going on over whether the U.S. will fall into a new recession or not.  The dollar is also up against the Euro, international funding issues remain tight, and the headlines are still more negative than positive.  So, ask yourself one question: Why is West Texas Intermediate Crude is back at $100.00 per barrel?

This morning we saw shortly after 9:00 AM that oil was up $.130 at $100.67 per barrel.  The United States Oil Fund (NYSE: USO) is trading up 0.65% at $38.68 this morning in conjunction.  iPath S&P GSCI Crude Oil TR Index ETN (NYSE: OIL) is up 0.65% at $25.50.

The move in oil services is lower, perhaps with the broader stock market, but the Oil Services HOLDRS (NYSE: OIH) is down 1.05% at $127.83.  SPDR S&P Oil & Gas Exploration & Production (NYSE: XOP) has not yet traded but is indicated slightly lower than the $55.78 close of Tuesday. The United States Brent Oil Fund (NYSE: BNO) is down 1.8% at $76.54.

Gasbuddy.com shows the national averages on gasoline prices as follows for a gallon of unleaded gasoline:

• Today $3.409
• Yesterday $3.418
• One Week ago $3.453
• One Month ago $3.494
• One Year ago $2.892

Gasoline has a lag at the pump, but $100 is going to let those gas station owners go outside and raise the prices on the signs.

CNBC has a chart analysis saying that the upside for oil is capped at $110 to $115, but that offers little comfort.

JON C. OGG