New York (Platts)--2Jul2008

US President George Bush Wednesday said he has urged all sides in
the dispute over Iran's nuclear development program to seek a diplomatic
resolution to the standoff.

Following his televised comments about the upcoming G8 summit in Japan,
Bush was asked by reporters about the prospect of Israel unilaterally
launching a military strike against the Iranian nuclear facilities.

He responded that while "all options are always on the table," his "first
option is to solve this problem diplomatically.... I've made it very clear to
all the parties that the first option is to solve the problem diplomatically."

In June, Israel conducted a major military exercise over the eastern
Mediterranean Sea, which heightened speculation that it was preparing to
attack the Iranian nuclear facilities. Iranian officials subsequently
threatened to shut the Strait of Hormuz, a key shipping lane for Mideast oil,
if it were attacked.

The Strait of Hormuz is the passageway to around 20% of the world's oil
supplies, including exports from fellow OPEC-member countries Iraq, Kuwait,
Qatar, Saudi Arabia and the UAE. Iran is OPEC's second-largest producer behind
Saudi Arabia.