Oil is surging in early morning trade Monday, as European
nations and the International Monetary Fund agreed to a massive $1
trillion bailout package to rescue Greece.
The plan has led to a surge not only in the euro and European
equities, but has reduced the risk premiums of euro zone sovereign
debt, which have in turned buoyed demand for energy worldwide on
hopes that the worst is over for the region.
At 0800 ET, Brent crude is up 3.9% at $81.30 a barrel, while
light sweet crude is also 3.9% stronger at $78.02 a barrel, and
natural gas is up 1.22% at $4.06 a million British thermal
There are concerns, however, that the massive package will be
too high a burden for some European nations to bear. Worries abound
too that Spain and Portugal, among other countries, will also need
to be bailed out by the European Union.
On the corporate front, coal producer Peabody Energy Corp. (
) has reduced its offer for Australia's Macarthur Coal Ltd. (
) on worries about Australia's proposal to impose a 40% tax on
mining profits. Peabody has reduced its offer for the company to 15
Australian dollars a share, down from its earlier proposal of 16
Australian dollars, bringing its offer down to about 3.8 billion
Australian dollars, or $3.4 billion.
In earnings news, Canada's oilfield services company Ensign
Energy Services Inc. (
) reported first quarter earnings that missed analysts' estimates
on lower pricing and falling revenue.
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