Greece Oil Shock

In January I warned that the EU embargo on Iranian oil would cause Greece problems:

"There has been much hype and sanctimonious puffing of chests from the EU about its agreement "in principle" to ban imports of oil from Iran.

However, as Paul Stevens economist and emeritus professor at Dundee University in Scotland notes, Greece currently imports 30% of its domestic oil from Iran on favourable terms.

Were Iranian oil imports to be banned, where would Greece get its oil from?

Saudi Arabia?

Maybe, but at an economy busting $150+ per barrel.

As with all EU "plans" this one has not been thought through."

In February I noted that:

"They are currently negotiating for supplies of oil from elsewhere, any admission that their supplies have been cut will negatively impact those negotiations and cause panic buying in Greece."

As predicted, things are not going well; as reported by News.AZ:

"The EU has postponed an April deadline to review the impacts of the bloc’s embargo on oil imports from Iran due to Greece's concerns on finding new oil suppliers."

As ever with all EU "plans", no one has bothered to think through the consequences of them.

Oh The Irony - Panic Buying Saved Britain

In a twist of irony, it seems that the panic buying of petrol caused by the government mishandling of the tanker drivers' dispute may have helped pull Britain out of recession.

Figures from the Office for National Statistics (ONS) showed a 1.8% month-on-month increase in retail sales volumes and a 3.3% year-on-year rise. The increase was above economist forecasts, and were partly helped by a 4.9% increase in petrol purchases.

Obama Demonises Oil Speculators

President Obama has today castigated oil speculators for manipulating the oil market, and has proposed new measures to limit speculation in the oil markets,.

This is rather ironic, as only a month ago the Whitehouse manipulated the oil market by leaking rumours (and then denying them) of a release of strategic reserves which of course sent the price of oil down.

Greece's Oil Shock

In February I wrote that Hellenic (Greece's main oil refiner):

"are currently negotiating for supplies of oil from elsewhere, any admission that their supplies have been cut will negatively impact those negotiations and cause panic buying in Greece."

Today Hellenic have announced that it has suspended purchases of Iranian crude in April, as approaching sanctions on Tehran have made banking payments virtually impossible.

This of course means that its negotiations for reasonably priced supplies for Greece from elsewhere have just been torpedoed.  

Hardly good news for the imploding Greek economy!

Emergency Oil Reserves Tapped

The US and UK have agreed (ahead of the US fleet boosting its presence in the Gulf, and SWIFT cutting Iran off from the world's financial system) to release reserves of emergency oil stocks.

UPDATE

The Whitehouse are currently denying the veracity of this report. Meanwhile the "inaccurate" report has had the desired effect of driving oil prices lower.

Funny that!

FURTHER UPDATE

The Prime Minister's official spokesman re Obama Cameron talks has admitted that the issue was discussed:

"The issue of oil supply was discussed but no decisions were made."

You can rest assured that the decision has been been made, and will be implemented on a predetermined date/event.

Oil Shipment To Greece Stopped

"Greece relied on Iran for more than half of its oil imports during some months last year after traders and oil majors pulled the plug on supplies and banks refused to provide financing for fear that Athens
would default on its debt."

Unfortunately, Iran has just stopped a shipment of oil to Greece:

"Oil tankers that had come to transfer 500,000 barrels of Iranian oil to a refinery in Greece had to go back empty-handed after Iran refused to give the shipment,"

However, Hellenic have denied the veracity of this story :

"That has nothing to do with us ... all supplies from Iran have been processed normally,"

Well, they would have to deny this wouldn't they?

They are currently negotiating for supplies of oil from elsewhere, any admission that their supplies have been cut will negatively impact those negotiations and cause panic buying in Greece.

Beware denials and irrational optimism from Greek oil companies!