Greece goes, "oops"

July 1, 2015 07:56 AM
Daily Energy Markets Analysis

On second thought...

After Greece became the first developed nation to miss a payment to the International Monetary Fund, it seems that after 24 hours of economic collapse Greece now says it is now ready to accept the bailout conditions it previously rejected. Though it may be too late as the total recklessness and arrogance of Greek Prime Minister Alexis Tsipras has caused damage and pain to the people of Greece that easily could be avoided.

Tsipras decided to play poker using his country's people as poker chips and Germany just called his bluff. When Greece begged for more talks, German Chancellor Angela Merkel said there is no point until the July 5 referendum that Tsipras called for and is telling his people to vote against the European Union.

Now, in desperation as its economy implodes, Greece is now saying it will take the deal with the creditors with some so- called minor changes. Germany may consider the latest desperate plea, but say they want  more clarity of this latest proposal before they give Greece any hope. In the meantime Tsipras has continue to cause pain for his people as his overestimated his and Greece's importance to the Eurozone.

Crude oil prices also sold off after the American Petroleum Institute reported that crude supply fell 19,000 barrels as opposed to an estimate of 2.5 million barrel draw. Yet, is that really that bearish? Most should have been looking for a rebound in supply after the aftermath of Tropical Storm Bill. The API also reported that distillate supply rose by 263,000 barrels and gasoline supply rose by 334.00 barrels. Plus, we saw a draw in the all-important Cushing, Okla., delivery point.

OPEC production also hit a three year high, led by Iraq that it's production soared to an all-time high. Add that fact to that Iranian nuke talks were pushed back and Greece inspired economic turmoil it is amazing that oil is holding up as well as it is.  

Ethanol prices soared after the USDA quarterly crop report. Corn prices drove gains after the USDA missed acreage estimates by about 1 million acres. All the grains soared as soybeans and cotton also missed estimates to the bullish side. Wheat on the other hand was bearish but supported by the rest of the complex.    

About the Author

Phil Flynn is a senior energy analyst at The PRICE Futures Group and a Fox Business Network contributor. Phil 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.