NEWS / Foreign Exchange

Crude Market Update

- According to wire headlines overnight gunmen attacked a Chinese oil company field in Ethiopia. No further details were provided.

- According to a Wall Street Journal article citing the Chief Economist of the IEA China is set to surpass the US as the world's largest emitter of greenhouse gasses in 2007 due to a rise in economic growth.

- BP announced that its second largest refinery, in Whiting Indiana, has cut production to 200K bpd (half of its total production capacity) following the failure of the plant's hydrotreating unit in March. BP will maintain output at the 200K bpd level until the necessary repairs are completed, for which there is no estimated time frame.

- The price of coal is set to rise in China during the second half of 2007 following the implementation of a new government fee. Producers will have to pay as much as $5.20 per metric ton mined.

- As noted yesterday, the Sunday Times this weekend ran an article saying that Al-Qaeda leaders in Iraq are currently planning the first "large-scale" terrorist attack on Britain and other western targets with support from Iran. This has continued to place some upward pressure on oil prices early this week.

- On the weather front, Accuweather wrote on its website that a storm system diving out of the Four Corners region will bring more severe weather to the Plains before bringing rain and cooler air to the East. The showers and thunderstorms will bypass the Southeast, where dry conditions are keeping the wildfire danger at an extreme level.