- The EIA releases its weekly inventory data today at 10:30a.m. According to a widely followed wire survey, crude inventories are expected to have risen 2.03M barrels last week, gasoline inventories to have declined by 2.05M and distillate inventories to have declined by 1.5M.

- Crude oil spiked higher by more than $5 in 7 minutes to trade above the $68 in Asian trading on a rumored naval confrontation between U.S. and Iranian forces in the Persian Gulf. The U.S. Navy and White House were quick to dismiss the rumors. The BBC reported that the UK government is preparing to release photographic evidence to support its assertion that 15 UK sailors seized by Iran were not in Iranian waters. Oil prices have now settled around $63.80. Conversely some floor sources are saying that futures spiked up because of option expiry where some calls out of the money were exercised unexpectedly forcing a hedge cover of 3500 big May contracts.

- The UK Defense Ministry said this morning that according to GPS data the British sailors captured on Friday were in Iraqi waters, approximately 1.7 nautical miles away from Iranian waters.

- The OPEC secretary general said overnight that there is plenty of oil flowing into the market, noting further that the recent price surge is unrelated to the fundamental picture.

- Japan's largest petroleum refiner Nippon Oil said overnight that it will cut oil processing by 8% in April due to lower demand resulting from temperatures that are warmer than usual. Nippon oil plans to process approximately 28M barrels of oil in April.

- According to a VOA news article the Mexican state-owned oil company Pemex is on the brink of insolvency. Although Mexico has plenty of oil, production is declining as politics prevent Pemex from making the investments necessary to develop the resources.