The global economy is going nowhere quick and now it is starting to be reflected in corporate earnings reports. This sent equities into a tailspin that weighed on oil over concern that oil demand growth is also going to slow further.
A sprinkle of optimism coming from Europe coupled with some early corporate earnings reports that came in better than expected was enough to send the equity markets into a decent one day rally that spread to the oil sector.
The combination of slow growth in the global economy along with current fundamentals that are starting to show signs of supply outstripping demand have kept oil prices hovering near the lower end of the trading range for the last two weeks.
Oil quickly is coming to the reality that QE3 in the US, more QE in the UK and Japan as well as the ECB bond buying program are not likely to result in a major growth spurt in any of the aforementioned economies.