Of course, the market was only beginning to calm when the Colonel (not Sanders) Gadhafi or is Kaddafi went on his rambling diatribe. Gadhafi said heck no, he won't go and vows to die a martyr on Libyan soil, which might be a popular choice if he just gets it over with and does it himself and doesn't bring anyone with him. Still with the Libyan Army seemingly splitting in two, the possibility of civil war is sadly becoming a more likely possibility.
In the aftermath of his ramblings and his lack of compunction for destroying human life, the oil price spiked to its highest level since 2008 and gasoline prices to a near record high for retail this time of year. We saw stress in the other markets as stock prices plunged on recession fears. Grain prices hit the downside limit in corn, soybeans and wheat as fear that rising prices will moderate the demand for protein. Copper prices plunged on fears that China would have less demand in a world that was restrained by higher prices. We saw treasuries rally in a flight to quality as did the precious metals. Perhaps even the precious metals rally was restrained a bit by fears that a recession may curtail some metals investment buying. We saw the bonds and notes rally in a flight to quality play inspiring a very good auction.
It is obvious by the warning signs that we are seeing in other markets that this oil rally is different than any other we have seen this year. This is not a macro rally or a rally inspired by QE2 or some other extraordinary stimuli. This is about fear and the increasing possibility that global oil production will be at risk.
Phil Flynn is senior energy analyst for PFGBest Research and a Fox Business Network contributor. He can be reached at (800) 935-6487 or at firstname.lastname@example.org.