Yet what could send crude tanking is a pullout of Greece from the Eurozone. That would more than likely take us below $85 and open the door for a potential $30 drop. Yet that is unlikely as the markets have already sent a message to all the leaders in Europe that a messy exit by Greece would lead the global markets into another deflationary death spiral. So whether Greece leaves the EU or not the bottom line is that all realize that they had better be ready with the printing presses. In fact the fear of what may happen may be softening some deeply held political positions.
Bloomberg News reports, "Chancellor Angela Merkel left the door open to a compromise on debt sharing in the Eurozone as Italian Prime Minister Mario Monti said he can help bring Germany round to acting in Europe’s “common good.” Merkel’s veto on allowing Germany to underwrite joint debt issuance in the 17-nation euro region is under fire from her international partners as well as the domestic opposition. While she refused to back joint Eurozone bonds at a Brussels summit on May 23, Germany’s opposition parties wrung a concession from the chancellor on her return to Berlin yesterday to reconsider a separate proposal on common liability for sovereign debt. The blueprint, published in November by Merkel’s council of economic advisers, involves a so-called European redemption fund that would help governments scale back outstanding debt to below 60% of economic output in return for constitutional commitments on economic reform.”
As far as Iran goes, talk is good but AP is reporting, “ Diplomats say the U.N. nuclear agency has found traces of uranium at Iran's underground atomic site enriched to higher than previous levels and closer to what is needed for nuclear weapons. The diplomats say the finding by the International Atomic Energy Agency does not necessarily mean that Iran is secretly raising its enrichment threshold. They say the traces could be left during startup of enriching centrifuges until the desired level is reached. That would be a technical glitch only. But they say the agency is investigating the find because the higher the level of enrichment, the easier it is to turn uranium into nuclear warhead material. The diplomats demanded anonymity from the Associated Press because their information is confidential. They all follow the IAEA's monitoring of Iran's nuclear program.” Stay Tuned to another reason why oil may be near a bottom.