It's a mania, mania on the floor, and the markets are moving like it's never moved before. It's a mania a mania on the floor and the markets are moving like they have never moved before.
Record breaking swings and dings as the markets are manic over the twists and turns coming out of Europe. First commodities seem to crash as fears of a Greek default and a collapse of the Eurozone will freeze global markets sending commodities into a deflationary depressed state. Yet then commodities soars on hopes that a deal to save Greece and the rest of Europe is indeed in hand. Then word of doubts from some members over the final terms of a bailout send commodities crashing.
Yesterday fears that Germany might not get the votes at home to raise the cash to fund the bailout sent commodities crashing once again. Add to that the end of the quarter and the day before Rosh Hashanah and you saw commodities just fall off of the ledge. Now today hopes that Germany will indeed get the votes and the cash to save Greece has commodities roaring despite more fears that China could be slowing down. The volatility can cut you like a knife if the gift becomes the fire. All the while you're stuck in between .What's will and what will be a mania a mania on the floor and the market is moving like it never has before.
And through it all oil was able to ignore a lot of news. Crude railed when they got a "Surprise" build in U.S. commercial crude oil inventories of 1.9 million barrels but should we really have been surprised after the draw a week ago? I am surprised the build is not even bigger. A big influx in the Gulf coast as we see the area recover in the aftermath of tropical storm Lee. Cushing Oklahoma, though, did see a draw. The EIA also showed that gasoline inventories increased by 0.8 million barrels l and Distillate fuel inventories increased by 0.1 million barrels last week and are in the upper limit of the average range for this time of year.
The EIA also wanted you to know about some positive oil supply developments in West Africa. The EIA said, "With the recent focus on supply disruptions and the potential for continuing unrest in North Africa and the Middle East, several positive developments in oil supply from West Africa may have escaped attention. Arresting earlier declines, the region's top two producers, Nigeria and Angola, have each managed relatively robust production and export performances, helping offset shortfalls in supply from Libya, Syria, and Yemen. Both countries offer the promise of further, significant capacity additions in the short- to medium-term, although, in Nigeria, some major challenges remain. The region also includes a number of emerging suppliers, including Ghana, which has experienced a rapid ramp up in output from less than 10,000 barrels per day (bbl/d) last year to over 90,000 bbl/d by mid-2011."
So when one supplier goes down and prices rise others inspired by higher prices find a way to increase production! Isn't that cool?
Phil Flynn is senior energy analyst for PFGBest Research and a Fox Business Network contributor. He can be reached at (800) 935-6487 or at email@example.com.