Yesterday, Crude Oil hit $122/ barrel and today we have it trading at $114.63. That's already more than $7 lower from yesterday's high.
The rally we saw less than 24 hours ago was Russia-U.S. fear driven and not insight on demand building. Now that Tropical Storm Fay is looking less and less destructive while tension are easing in Georgia, we are seeing oil fall closer to a Supply/Demand equilibrium.
The sell-off in commodities is the reason I haven't recommended Foster Wheeler (FWLT) even at these level. This stock moves in tandum with oil, although earnings shouldn't. I won't fight the tape.
However, when FWLT falls below $45, the risk-reward ratio looks great.
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