Oil trades higher on another possible Greece deal

Greece is the Word

Greece solved the problem and they see the light! We gotta get long now and think, they got it right.

There ain't no danger stocks can go too far if we start believing now that Greece can change who they are. Greece is the word!

They think austerity won't cause some growing pains, Why don't they understand, It's just a crying shame, The cuts are lying only real is real, We start to find right now if Greece can live with the deal, Greece is the word.

Greece is the word, is the word that you heard, does this latest plan have meaning? Greece is the time, the bond plan in motion Greece is the way we are feeling .

We print the money and we throw away conventionality belongs to yesterday, there is a chance that the EU needs a debt watching Czar unless we start believing now that Greece can change who they are. Greece is the word.

Greece is the word, is the word that you heard. Does the word default have meaning? This is a trade of illusion wrapped up in trouble laced with confusion, What we doing here?

We take the pressure and we throw away, common sense belongs to yesterday, there is a chance that futures can make it so far if we start believing now that Greece can change who they are. Greece is the word.

Against the back drop of a red hot oil market and geopolitical risk map, oil also got a boost on the hope that there will be a final deal to solve the Greek debt crisis. This of course is about the 100th time that we have heard this song and dance but it appears traders are moving and grooving to this Greece music. The latest plan has the European Central Bank swapping its Greek bonds for new ones to ensure it isn’t forced to take losses in a debt restructuring. Bloomberg News reports that, "The move may be completed by Monday, and could pave the way for a private-sector bond swap that aims to slice about €100 billion off Greece’s debt as the embattled nation struggles to stave off default."

Word of this possible deal sent stocks soaring and helped pump up oil that was already elevated due to a host of geopolitical reasons. Iran of course is the main reason along with a strike in Yemen and the violence in Syria spreading outside of its borders, not to mention a pipeline explosion. The Sudan and Nigeria are also seeing rising tensions as well. Yemen exports all of its oil to Europe and already those courtiers are looking for alternative supply before an expected Iranian oil embargo goes into effect.

Add to that a Reuters report about a Houston shipping channel that is fogged in with outbound-only vessel traffic and forty-three vessels delayed as fog persists for two days. They say that while fog eased at the upper end of the 53-mile (85-km) channel, Texas City and Galveston pilots still delayed movements due to fog at the lower end.

Natural gas gave us a surprise drawdown but it was probably the impact of an unusually high amount of nuclear power maintenance due to warm weather. The EIA reported that working gas in storage was 2,761 bcf, a decline of 127 bcf from the previous week. Stocks were 817 bcf higher than last year at this time and 765 bcf above the 5-year average of 1,996 bcf. This came as nuclear power is running at only 88% of capacity as many plants are taking advantage of the warm temperatures to do maintenance.

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.

 

Futures and options trading involves substantial risk of loss and may not be suitable for everyone. The information presented by The PRICE Futures Group is from sources believed to be reliable and all information reported is subject to change without notice.


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