london (Platts)--22Jun2007

Global crude futures traded lower Friday, ahead of the weekend, as crude
exports from Nigeria remained unaffected by the ongoing strike. However, later
in the day market players expected some short covering ahead of the weekend
due to the uncertainty over oil exports from Nigeria.
     At 10:12 GMT the August ICE Brent futures contract was pegged at
$69.71/barrel, down 51 cents. The August WTI contracts on ICE and NYMEX traded
37 cents lower at $68.28/b.
     "It's lower now but I think we'll see some hedging and covering ahead of
the weekend. People are still unsure how long the strike will go on and if it
will affect cargoes leaving Nigeria," a London-based broker said.
     Crude loadings from Nigerian oil tanker terminals, which ship about 2
million b/d, continued Friday after overnight talks between the unions and the
government ended in deadlock, shipping agents said.
     "For now, they have made special arrangements and the terminals and ports
are still being manned so loadings are continuing. But if the strike continues
until Monday, then the terminals will be affected," the agent said.
     But the head of the blue-collar Nupeng union warned that exports could
soon be hindered as there has been a "reasonable level of compliance" from
members to withdraw from terminals.
     The unions started the strike on Wednesday after the Nigerian government
refused to reverse a hike in fuel prices at the pump.
     On a technical note, market players said that prices are looking bearish,
especially after front-month August ICE Brent dropped through the
psychologically important support level of $70/b.
     The WTI/Brent spread settled Thursday at its highest level since late
March, at minus $1.57/b, and continued to narrow Friday.
     Middle East crude futures were lower as well. The August DME Oman
contract traded 35 cents lower at $65.94/b, whilst ICE Dubai changed hands at
$65.89/b, off by 38 cents.
     ICE gasoil futures lost most of the strong gains made Thursday, pegged at
$619.25/mt, down $13.50/mt. Product futures on NYMEX also shed most of
Thursday's gains with the July heating oil contract trading 192 points lower
at $2.0055/gallon. The RBOB contract fell 149 points at $2.2318/gal.
--Jean-Luc Amos, jean-luc_amos@platts.com