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U.S. Crude Stocks Take Back Burner To Greece

Published 06/24/2015, 08:08 AM
Updated 07/09/2023, 06:31 AM

GDP data due out today should have an effect on whether or not strength remains in commodities based on US growth continuing to bolster demand. Worse than expected German economic data has taken back the bulk of yesterday’s rally in crude oil and the refined products as the ebb and flow of price discovery continues with the mixed global economic data.


Greece continues to remain center stage as it appears that the latest reform proposal put forth by the Greeks has been rejected by the creditors holding their paper. Now the Greek PM will be heading to talk directly with the EU and the IMF in an effort to garner some governmental assistance with the proposed credit revisions that would enable the troubled nation to remain solvent. While this could be the last gasp before default, it is hard to imagine that the EU would allow this particular domino to fall knowing full well that there are several other (Portugal, Spain, even Italy) nations carrying the same type of troubled debt loads. A default to Greece most likely would be seen as the start of the end of the EU, a scenario Mr. Drahgi most certainly does not want to trigger.


It is important to consider that the Greek situation is one of confidence a not a real driver from a supply and demand perspective when looking at the energy complex. While there seems to be unending rounds of these debt 'cliffs' when it comes to the troubled Mediterranean nation, many have gone relatively unnoticed as there were more pertinent fundamental focal points at the time. It seems that this instance happens to coincide with a rather quiet time from a news perspective creating a data vacuum that needs to be filled. In a nut shell, this is most likely yet another non event in the greater scheme of the commodity world.


The API data released yesterday afternoon showed another draw in crude stocks greater than the expectation. This has become a now four to five week trend that could continue to lend support to the price discovery as it effects the overall global supply picture.


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