Oil caught in European debt drama

Seven Days

It's now seven days to fiscal sanity, or is it the alternative? It is do or die with an October 23rd deadline. A deal to save Europe, which has to be done in seven days, and France and Germany have to do the heavy lifting. The G-20 told the EU that they have one week to come up with a "comprehensive plan" that includes the details on how much of a haircut Greek bondholders will have to take and a plan to recapitalize all of the debt ridden European banks. It seems that all are agreed and Europe will be saved yet again.

Yet not so fast. Perhaps that seven day deadline is not as hard and fast as the markets at first believed. Dow Jones said that German Finance Minister Schauble said the upcoming EU summit will not present an ultimate solution for the crisis. What?

The bottom line is that oil is living and dying with the twists and turns in this European nightmare. If Europe fails to come up with a viable plan then the word sinks back into crisis mode and the demand for oil will plummet.

Iranian revelations are also disturbing. Fears that perhaps this could escalate to some type of military conflict could keep some upward pressure on the Brent WTI spread.

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 pflynn@pfgbest.com.

About the Author
Phil Flynn

Senior energy analyst at The PRICE Futures Group and a Fox Business Network contributor. He is one of the world's leading market analysts, providing individual investors, professional traders, and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline, and energy markets. His precise and timely forecasts have come to be in great demand by industry and media worldwide and his impressive career goes back almost three decades, gaining attention with his market calls and energetic personality as writer of The Energy Report. You can contact Phil by phone at (888) 264-5665 or by email at pflynn@pricegroup.com. Learn even more on our website at www.pricegroup.com.

 

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