Crude prices continued to climb over the past two weeks fueled primarily by the market's assessment that the worst of the recession was now behind us, a flight by investors from equity and currency markets into commodities including oil and a generally weaker U.S. dollar. Gasoline prices after having been effected in May by reduced imports and anticipated increased Memorial Day demand have now stabilized considerably in reaction to improved European imports and the realization of year over year reduced consumption. Distillate product pricing continues to be dramatically impacted by the current futures market contango which provides an almost 20 cent per U.S. gallon spread between current price and anticipated winter 2010 pricing. Under such circumstances traders continue to buy up distillate product for storage in anticipation of future profits. Platts is currently indicating that such storage capacity may soon be reaching a saturation point at which time the reality of recession related reduced demand should result in a lower priced distillate market.

The International Energy Agency added to investor's optimism Thursday forecasting that the slump in global oil demand in 2009 would be slightly less severe than previously expected. The organization revised its estimates up for the first time in 10 months.

• The U.S. Labor Dept. last week reported that 345,000 jobs were lost in May, much less than the half million job losses economist had been expecting. Notwithstanding, the unemployment rate now stands at 9.4%.

• RBC Capital markets in a research note last week states that "the U.S. economy is expected to exit the recession sometime later this year and/or early 2010 which should have a very positive impact on bringing the industry's earning back to normalcy."

• Gasoline: In the absence of any major supply interruptions the market is expected to weaken as supply should outweigh demand.

• Distillates: As storage currently available for product hoarding dries up, the current contango conditions should deteriorate effectively removing the existing upward pressure on distillate prices.

• Crude: U.S. Investment bank Goldman Sachs last week boldly predicted that given an anticipated global economic recovery and a potential shortage of oil supply crude prices could strike $95 a bbl by the end of 2010.