In fearful times markets will "price in" the most negative outcomes. Two weeks ago a number of markets got to the point where they probably couldn't go any lower without the thing they feared happening (the euro zone breaking up) coming to pass.
Nothing much changed this week. Europe still hovers on the brink, threatening to topple and fragment. But we got to a point two weeks ago when, for stocks to go lower, the euro zone probably had to splinter.
Then suddenly, like startled chooks, investors saw a chink of light in Europe. A handful of central banks, led by the US Federal Reserve, agreed to lower the fee to access an emergency fund of US dollars this week.
It was a boon for Europe's banks. Complete disaster would be averted for the moment.
The chooks took off, taking the ASX200 and the Australian dollar with them. It was the second-biggest weekly move for the local bourse in three years: 7.6 per cent. The next-best rise was at the height (or depth) of the global financial crisis, in November 2008 (9.54 per cent).
The move got people talking. Maybe the market will finally kick up over 4500 points and provide a psychological hand on the shoulder for investors?
At any rate, the dollar was thrust from a sulky US98? to $US1.03 in a matter of seconds. It ended the week sitting comfortably on $US1.02.
The US is looking to become a net exporter of oil products for the first time since 1949, the year John Lee Hooker released Crawlin' King Snake.
The US is still the world's biggest user of crude oil, but this year it has shipped 753 million barrels of diesel, gasoline and other fuels in the first nine months of the year. For the corresponding period last year, the US shipped 600 million barrels. Meanwhile, Asia is demanding more and more fuel, so much so that Saudi Arabia, the world's biggest fuel exporter, has been able to flog its lowest-grade crude at record premiums.
China's demand for fuel drove oil imports 4 per cent higher in October compared with September.
The amount of oil the country buys looks set to rise by 23 per cent this year, and is on track to rise by more than 19 per cent next year.
With winter demand kicking in in Asia, the Organisation of Petroleum Exporters (OPEC) has agreed to boost shipments of oil by 1 per cent, reaching a nine-month high.
Global oil prices looked set to make their first weekly gain in three weeks, helped by the winding down of oil stocks in Europe, as well as in the Asia-Pacific region, said an economist at National Australia Bank, Michael Creed.
"This has taken place over a series of months, with production issues in Nigeria and the North Sea ... On top of that, we've recently seen the decision in the US to reverse the Seaway pipeline which has driven up the price of West Texas Intermediate as stocks in Cushing, Oklahoma [the biggest oil facility in the world] were wound down."
Prices were also given a boost after Britain and France toughened their sanctions on Iran after an attack by Iranian citizens on the British embassy in Tehran. Britain retaliated, ordering Tehran to close its London embassy. The possibility of war allowed oil traders to add a premium to their trades.