US 'understands' why markets spooked by Iran comments:White House

New York (Platts)--5Jun2006

The White House understands why oil markets would be roiled by comments
from Iran threatening a disruption in supply, but those same markets will be
soothed if talks aimed to convince Tehran to stop uranium enrichment succeed,
President George W. Bush's top spokesman said Monday.

On Sunday, Iranian supreme leader Ayatollah Ali Khamenei said energy
supplies could be disrupted if tension escalates between the US and Iran over
the country's nuclear program.

While oil prices jumped in response, White House press secretary Tony
Snow urged caution.

"[We] understand why commodities markets may be unsettled by a comment
like that, but over time if this succeeds, then commodities markets are going
to be very happy and so should we all be," Snow told reporters during his
daily briefing, televised live.

The US and European partners last week hammered out a package of
incentives to convince Tehran to give up its program to enrich uranium, which
the west fears could be the first step to produce a nuclear weapon. The
package included a list of penalties Iran would face if it fails to halt its
nuclear work.

While Iranian oil officials have for months insisted there would be no
link between the country's oil exports and the uranium issue, Khamenei turned
up the rhetoric during a speech marking the 17th anniversary of the death of
Iran's Islamic revolutionary leader, Ayatollah Ruhollah Khomeini.

"You threaten Iran. You say you want to direct energy in the region. If
you make a single mistake about Iran, the supply of energy will definitely be
put in serious risk," he said.

But the White House's Snow downplayed those remarks.

"There are going to be any number of statements coming out of Iran. I
would caution against leaping to conclusions until the leadership in Iran has
actually had an opportunity the package of incentives and disincentives
offered by the EU-3 with the support of the United States," Snow said. "It's
easy to make comments into a vacuum."

--Kevin Saville, kevin_saville@platts.com

For similar news, take a trial to Platts Oilgram News at
http://oilgramnews.platts.com.


 

Copyright © 2005 - Platts

Please visit:  www.platts.com

Their coverage of energy matters is extensive!!.