Crude rises on Iran, weather-related concerns

Crude rises on Iran, weather-related concerns

Singapore (Platts)--31Aug2006

Oil prices edged higher in Asia on Thursday as the market shrugged off
unexpected builds in US crude and products stocks and turned its attention to
the Iranian nuclear row. Hurricane John, currently a category three hurricane,
also sent some jitters through the market though its path, along the west
coast of Mexico, implies there is no threat to oil production.
Iran's President Mahmoud Ahmadinejad Thursday vowed his country would not
back down an "inch" in the face of intimidation as a UN deadline expired for
Tehran to halt sensitive nuclear operations.
October light sweet crude futures on the New York Mercantile Exchange
traded at $70.41/barrel at 0929 GMT, up 70 cents from Wednesday's settle.
October Brent on the London Intercontinental Exchange traded at $70.57/barrel,
up 39 cents.
"Iran will not back down an inch in the face of intimidation, aggression
and will not accept being deprived of its rights," French news agency AFP
quoted Ahmadinejad as saying.
His defiant message came on the day a UN deadline expired for Iran to
halt uranium enrichment work or face possible UN sanctions. Tehran has made
clear it has no intention of renouncing the sensitive atomic activity, which
it insists is for generating electricity.
The United States, which accuses Tehran of using a nuclear energy program
as cover for a drive to make atomic weapons, meanwhile expressed confidence
that the UN Security Council can agree sanctions in September.
"I think it's abundantly clear that Iran has no intention of meeting the
deadline and meeting the condition that the countries put down three months
ago," US Undersecretary of State Nicholas Burns said.
"We believe the sanctions regime will be agreed to in September by the
Security Council and we're going to work towards that with a great deal of
energy and termination," he said on CNN.
The oil market appeared to have shrugged off Wednesday's bearish US
stocks report from the Energy Information Administration and American
Petroleum Institute.
Weekly inventory data from the US EIA on August 30 showed US crude
imports soared to 11.153 million b/d last week, their second highest level
ever, helping to offset the partial loss of production at BP's Prudhoe Bay
field in Alaska. As a result, total US commercial crude stocks climbed 2.48
million barrels, against market expectations of a 1.3 million barrel decline.
The EIA also reported a 400,000 barrel build in gasoline stocks in
contrast to analysts' expectations for a 650,000 barrel decline and a 1.3
million barrel build in distillates, higher than the 850,000 barrel increase
analysts had projected.

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