NEWS / Foreign Exchange

Crude Backs off of Highs as Tenions Seem to East

- The EIA released its weekly natural gas inventory data yesterday, which showed that natural gas inventories fell more than expected by 22bcf to 1.51 trillion cubic feet.

- After pushing higher during Asian trading crude futures are off of their best levels after the Iranian president said that he would look upon the situation with the British sailors positively. According to State TV Iran sent a letter to the UK embassy in Tehran requesting that the UK does not make any additional violations.

- According to a union official, the strike at the Marseille port in France is far from over. As of yesterday the strike was responsible for blocking at least 57 vessels from Europe??™s second largest oil hub.

- The Qatari oil minister said overnight that there is no reason for OPEC to consider taking action on oil prices, as prices are seen falling when the dispute between Iran and the UK is resolved. The oil minister said that refining capacity in the US continues to remain in a bottleneck.

- The IAEA is reportedly pushing Iran to agree to installing cameras in its underground nuclear facility while Western states contemplate a possible emergency IAEA meeting on the subject if Tehran refuses. The cameras, which the IAEA wants to stream images straight to its Vienna headquarters, would be seen by inspectors as vital to helping them verify that Iran does not enrich uranium to levels suitable for bomb fuel, or divert materials towards that end. Iran has said such intrusive surveillance goes beyond its basic safeguards commitment with the IAEA.

- Japanese oil imports declined for the tenth consecutive month in February as a result of warmer than usual weather. February crude imports were down 12% compared to the same period in 2006.