NEW YORK (TheStreet) -- I was talking to Joe Deaux about the fast drop in Brent oil prices over the last two days that was accompanied by the rise in our own benchmark West Texas Intermediate prices.
I think it's important for investors to keep an eye on both benchmarks because only looking at one can give an investor a jaded and wrong view about the trend in oil prices. If, for example, you just looked at the price of WTI oil over the last two weeks, you'd get the impression that oil prices were headed most significantly higher. But if you looked at the action of Brent prices over the same period, you'd get the absolute opposite impression.
What's actually happening is that these two major oil markets, which have been disconnecting for months in price, are finally finding some connectivity -- in Europe because of some less-than-stellar economic reports and in the U.S. because of the solving of some of the transport issues that have plagued the movement of crude oil here in the U.S. from the mid-continent down to the Gulf Coast.
So, for right now, neither a strongly rallying crude market nor a sharply falling crude market are really the case. For crude, there's sort of an "equalization of pressures" going on right now.But for stocks there will be an instant response -- in the refinery stocks including Valero (VLO), Tesoro (TSO), Western Refining (WNR) and Phillips 66 (PSX), to name a few. I talk about that reaction in the refinery stocks and more about the oil markets with Joe in the video above. At the time of publication the author had no position in any of the stocks mentioned. Follow @dan_dicker This article was written by an independent contributor, separate from TheStreet's regular news coverage.