The price of oil ebbed and flowed on Tuesday in response to a credit service noting it is poised to slash the European bailout fund's credit rating of debt, according to Bloomberg.
Standard & Poor's indicated the European Financial Stability Facility is subject to having its top credit rating downgraded should any guarantor's own debt grades slashed, which offset the goodwill of optimism regarding efforts to solve the euro zone debt scourge. Germany and France, respectively the region's first- and second-biggest economies, might be subject to the S&P downgrade along with the additional euro zone nations – all of which hinges on what comes of the December 9 meeting.
"Both oil and the stock market are waiting for signs of a resolution to the European debt crisis," research director Kyle Cooper with IAF Advisors in Houston told Bloomberg. "The situation in Europe has been the primary driver for a while and we'll probably chop around until the European summit."
At 3:03 p.m. on Tuesday, crude oil futures gained 0.81 percent, an 89 cent rise to $110.70 per barrel.
UPI reports the Monday warning from Standard & Poor's was issued to nations that use the euro. The countries that have been most victimized by the debt scourge are Portugal, Ireland, Italy, Greece and Spain, also known as the PIIGS nations.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.