One metric that the Bulls have been hanging their hat on recently has been higher oil prices due to recent drawdowns in inventories. They say that this is representative of increased demand from the beginnings of a recovery.
I am not in this optimistic camp and you know this based on my previous posts.
I have a rather simple explanation for this phenomenon. Due to the nature of this recession, summer travel has been significantly curtailed (sorry kids, no spring break trip to Mexico this year!). Instead we are seeing the resurgence of the old fashion American Road Trip. Families are spending more time together and instead of traveling out of the country (or long distances), are taking road trips to nearby recreational parks or to visit extended families. The era of frivolity has been replaced with frugality.
This means that once the break is over (if not sooner), we will once again see inventory builds and lower oil prices.