According to sources, recent reports by Pacific Capital Trading have stated that the rate of US economic growth was slowing although the odds of a recession were now less than 50 per cent as financial markets were beginning to return to normal.

Oil prices were seen to be volatile as 2007 closed, with investors debating whether demand for oil and petroleum products would be strong enough in the fourth quarter to support crude oil at nearly $100 a barrel. Some argued declines in refinery activity and heating oil inventories suggest supplies of heating and crude oil will be tight when heating season demand begins to grow.

Hong Kong-based Pacific Capital Trading reported that at the end of the third quarter, many U.S. refineries shut down for maintenance and re-geared their operations to turn out more home heating oil for the Northern Hemisphere winter. The refineries could start returning to production as early as this month and that ramp-up could increase demand for crude oil.

Pacific Capital Trading says traders are stating that oil prices should find strong support at $90 as participants view that as a good buying opportunity.