EAT YOUR OIL IRAN?

Oil market alarmed by Iran over higher prices
LINK:
http://www.iranmania.com/News/ArticleView/Default.asp?NewsCode=39669&NewsKind=Current%20Affairs

Monday, January 16, 2006 - ©2005 IranMania.com
LONDON, January 16 (IranMania) - Iran's warning
over the weekend that oil prices could increase
"higher than what the West expects" should be
taken very seriously, market analysts said
Monday, AFP reported.
According Investec's Bruce Evers, Iran "could
turn around and say, we are stopping exports
completely, which would probably cause a
huge spike in the price because the shortfall
could not be met".
Calling a halt to exports in the world's fourth
biggest crude producer remained a "distinct
possibility (and) that is what is worrying
crude markets at the moment", he added.
Spurred on by the crisis, London's Brent
North Sea crude neared a three-month high,
touching 63.18 dollars earlier Monday.
New York prices had approached 64 dollars
per barrel on Friday, while trading resumes there
Tuesday owing to a public holiday.
Oil prices have gained around five percent
since the start of 2006 while geopolitical
tensions, particularly over Iran, have
supported the market.
Britain, China, France, Russia and the
United States -- all permanent members of the
UN Security Council -- plus Germany met
behind closed doors in London on Monday to
discuss Iran.
Europe and the US are pressing for a tougher
line on Iran that could see Tehran hauled
before the UN Security Council over its
suspected pursuit of nuclear weapons.
Analysts are "asking questions about oil
sanctions and embargos" with regard to
Iranian oil, according to Calyon's Mike Wittner.
Iran had said over the weekend that it was
"not scared" of being hauled before the UN
Security Council -- and warned any sanctions
over its disputed nuclear programme could
cause an unexpected hike in oil prices.
Davoud Danesh-Jaafari, Iran's economy
minister, was quoted as saying by state
television on Sunday: "Any sanctions in the
current situation would be more detrimental
for the West than for Iran.
"Any disturbance of the economic and political
situation of the country could turn the regional
situation into a crisis and increase the price of
oil higher than what the West expects."
For the time being, Wittner said that the ongoing
situation would merely add a "bullish bias" to
prices, rather than an immediate spike.
"This crisis is going to drag on for at least
another six months before oil sanctions
become a real possibility."
"The Iranian nuclear issue will simmer for
many months, quite possibly for the entire
year. While it simmers, it will add a bullish
bias to prices."
Crude prices hit historic highs in nominal
terms last August. Following the devastation
wrought by Hurricane Katrina on US Gulf Coast
energy installations, prices struck 70.85 dollars
per barrel in New York and 68.89 dollars in
London.
That marked a 70-percent jump between
January and August 2005, before a pull-back in
prices owing largely to mild weather across the
northern hemisphere in the run-up to winter.
Amid the strong rally in prices in recent weeks,
markets have begun to draw comparisons to
the Iranian revolution in 1979, when oil prices
surged to the highest ever level in real terms.
Adjusted for inflation, oil prices in New York
had hit 87.23 dollars per barrel on
November 30, 1979, in today's money,
according to analysts' estimates.
Iran, the second-biggest oil producer within
the Organization of Petroleum Exporting
Countries, produces some 4.2 million barrels
per day, of which 2.7 million bpd are exported.

I SAY KEEP YOUR OIL IRAN
WE WILL NOT BOW TO YOU
EVER!