Drop in US oil price is due to an abundance of new supplies

Although demand for oil has softened, the precipitous drop in oil prices is not due to widespread economic deterioration but to an abundance of new supplies resulting from fracking and shale drilling. 

The latest report from the IMF attributes the collapse in oil prices to an increase in supply rather than a decline in demand.  This is good economic news.  However, the IMF did  downgrade U.S. economic growth to 3.1% for 2015.  (Still above the Fed target of 2.5%).

"The bad news regarding low oil is undoubtedly front loaded - energy companies are in the firing line with their top line sales and bottom line earnings taking a direct hit. The beneficiaries, the consumers, are slowly coming to the table." said Voya Investment in a report 

Retail sales for March finally reversed course after three months of declines and rose .9%.  This is the strongest increase in a year.  Economists were hoping for a slightly better rebound after a truly miserable winter but the trend is in line with improving expectations.