Oil was once again on the radar of the “Fast Money” traders, with many of them wondering where oil was headed next.
While prices have climbed back up to where they were when President Obama announced he would tap the strategic petroleum reserves, oil still finished the quarter down.
According to David Greenberg, President of Greenberg Capital, oil is range bound between $90 and $100. The government seems to be very happy when it’s under $100, he told the traders, and he doesn’t see it going below $90 with the way demand is going right now.
However, if Washington doesn’t get the debt ceiling under control, Greenberg said public opinion will go down and “we could see a major slowdown in the economy.” While he doesn’t see a massive drop in oil, he does think it could get to the $85 to $90 range in this scenario.
And while some question the effectiveness of the SPR release since prices have crept back up, Greenberg said it did the job it was supposed to do — it made consumers feel better.
“They wanted to get lower gas prices for the July 4th weekend and they did,” he said. “It was basically a three day supply and if you notice it went down for three days and then came right back up.”
Independent oil trader Dan Dickeralso thinks the SPR’s move was a good thing. Dicker, who expects weakness in oil for the next few months, believes the release will keep speculators who have been inflating prices out of the market.