The recent decline in West Texas Intermediate and the U.S. Oil Fund (NYSEArca: USO) cannot be blamed entirely on increased production in the Bakken and Eagle Ford shales. The Monday close for crude for December delivery was $4 below where WTI closed on Nov. 17, 2011, indicating demand is not where it should be at this point in an economic recovery. [October’s 10 Worst ETFs]
Slack demand has forced per capita miles driven return to levels not seen since 1995. With UGA 4.7% below its 200-day moving average, more trouble could be on the horizon for the fund.
Estimated Vehicle Miles Driven
Chart Courtesy: dshort.com via Barry Ritholtz for Bloomberg