"We expect a highly volatile market over at least the next six months with the European debt crisis continuing and further effects from Chinese monetary tightening."
The much talked about potential, longer-term decline of the U.S. dollar, which would help drive oil prices higher, is also a factor that WeatherBELL Analytics' energy analyst Alan Lammey is paying close attention to.
Ultimately, "both gasoline and heating oil prices remain at the mercy of the economic environment," Smith of Summit Energy summed up.
"Should the U.S. economy improve, crude prices will rise, and hence so will gasoline and heating oil," he said. "However, if we see further deterioration in the European debt crisis, there will be a negative ripple effect on the US economy, and product prices will likely fall."
The much-anticipated break of oil prices above $100 a barrel kicked in Wednesday on news that
Enterprise Products Partners
have agreed to open a crucial US oil
The move to reverse the Seaway pipeline by the end of the second quarter of 2012 will allow U.S. oil to flow more easily from the country's major storage hub in Cushing, Okla. to Gulf Coast refiners. As a result, WTI prices will more accurately reflect global market price conditions and are soon expected to trade more closely with Louisiana Light Sweet Crude, which has for months been trading at the same or even higher prices than Brent.
Energy stocks were mostly falling Thursday.
(BP - Get Report)
was falling 0.8% to $43.17;
(APA - Get Report)
was down 0.4% to $102.30;
(EOG - Get Report)
was lower by 0.3% to $100.41;
(CHK - Get Report)
was behind by 0.6% to $25.32;
(TPLM - Get Report)
was higher by 1.1% to $6.27;
was flat at $41.95; and
(APC - Get Report)
was down 0.4% at $78.63.
-- Written by Andrea Tse in New York.
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