IPE Brent down $1 on Mideast ceasefire, BP Alaska crude output

IPE Brent down $1 on Mideast ceasefire, BP Alaska crude output

London (Platts)--14Aug2006

IPE Brent futures in London fell below $75/barrel for the first time in
nine sessions as the market used the ceasefire in the Middle East and BP's
statement to increase its Alaskan crude output as reasons to sell, broker
said.
At 1041 London time (0941 GMT) September IPE Brent futures were changing
hands at $74.62/barrel down $1.01/barrel, in line with a general sell-off
across the energy complex.
"It's pretty much run of the mill stuff in a quiet start to the week. The
ceasefire in the Middle East and BP keeping some crude output in Alaska have
pushed prices down," a London-based broker said.

BP WILL INCREASE PRUDHOE BAY OUTPUT TO 200,000 B/D
BP will continue oil output at the western portion of Alaska's 400,000
b/d Prudhoe Bay oil field and will ramp the area up to 200,000 b/d after the
company completes a maintenance shutdown at Gathering Center 1, BP said
Saturday in a statement on its web site. The company did not say when
maintenance would be completed.
Current production at the partially shuttered western field was 150,000
b/d of oil from BP's estimate on August 10. The eastern half of Prudhoe
remained shut. "Ten metal sleeves will be required over sections of EOA
[eastern operating area] pipeline showing corrosion damage. Seven of those
have now been installed, with three remaining sleeves to be delivered and
installed today" BP said.

MIDDLE EAST CEASEFIRE
A UN-brokered ceasefire in fighting between Israel and the Shi'ite
militant group, Hezbollah, took effect at 0500 GMT. However, Israel said
Monday it would maintain its air and sea blockade of Lebanon despite the
ceasefire on the ground to end more than a month of fighting.
"The maritime and aerial blockade will be kept in place until a mechanism
is put in place to control smuggling of arms" to Hezbollah, a military source
said. Israel says that Hezbollah receives arms from Syria and Iran, a charge
denied by the two countries.

IRAN IGNORES THREAT OF UN SANCTIONS
In other news, Iran on Monday said it was not intimidated by the threat
of UN sanctions after the Security Council passed a resolution urging it to
suspend uranium enrichment, saying they would have no effect. AFP reported.
"The threats of sanctions do not have any effect on us. The
double-standard approach employed by the Europeans has resulted in the loss of
their credibility," government spokesman Gholam-Hossein Elham told reporters
in his weekly press briefing.
European powers have offered Iran a package of incentives to encourage it
to stop nuclear activities that could lead to building an atomic weapon even
as the UN Security Council passed a resolution calling for an end to uranium
enrichment.
"We are prepared for all (possible) scenarios and it the West and
especially the United States which will lose more, because we control the
energy sources," Elham added.
--Jean-Luc Amos. jean-luc_amos@platts.com

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