Iran stops oil sales to British and French firms

Iran stops oil sales to British and French firms

Strap on your day trader hats, all you commodity junkies, crude is about to hit the roof with this news. The summer is going to be a boondoggle for the white house. And, Obama will more than likely lose the presidency over this.

Tehran, Iran

TEHRAN (Reuters) – Iran has stopped selling crude to British and French companies, the oil ministry said on Sunday, in a retaliatory measure against fresh EU sanctions on the Islamic state’s lifeblood, oil.

“Exporting crude to British and French companies has been stopped … we will sell our oil to new customers,” spokesman Alireza Nikzad was quoted as saying by the Ministry of Petroleum website.

The European Union in January decided to stop importing crude from Iran from July 1 over its disputed nuclear program, which the West says is aimed at building bombs. Iran denies this.

Iran’s oil minister said on February 4 that the Islamic state would cut its oil exports to “some” European countries.

Iran Stops Oil Sales to Britain and France

The European Commission said last week that the bloc would not be short of oil if Iran stopped crude exports, as they have enough in stock to meet their needs for around 120 days.

Industry sources told Reuters on February 16 that Iran’s top oil buyers in Europe were making substantial cuts in supply months in advance of European Union sanctions, reducing flows to the continent in March by more than a third – or over 300,000 barrels daily.

France’s Total has already stopped buying Iran’s crude, which is subject to fresh EU embargoes. Market sources said Royal Dutch Shell has scaled back sharply. Shell had no comment on the announcement.

Among European nations, debt-ridden Greece is most exposed to Iranian oil disruption.

Motor Oil Hellas of Greece was thought to have cut out Iranian crude altogether and compatriot Hellenic Petroleum along with Spain’s Cepsa and Repsol were curbing imports from Iran.

Iran was supplying more than 700,000 barrels per day (bpd) to the EU plus Turkey in 2011, industry sources said.

By the start of this year imports had sunk to about 650,000 bpd as some customers cut back in anticipation of an EU ban.

President Mahmoud Admadinejad of Iran

Saudi Arabia says it is prepared to supply extra oil either by topping up existing term contracts or by making rare spot market sales. Iran has criticized Riyadh for the offer.

Iran said the cut will have no impact on its crude sales, warning that any sanctions on its oil will raise international crude prices.

Brent crude oil prices were up $1 a barrel to $118.35 shortly after Iran’s state media announced last week that Tehran had cut oil exports to six European states. The report was denied shortly afterwards by Iranian officials.

“We have our own customers … The replacements for these companies have been considered by Iran,” Nikzad said.

EU’s new sanctions includes a range of extra restrictions on Iran that went well beyond U.N. sanctions agreed last month and included a ban on dealing with Iranian banks and insurance companies and steps to prevent investment in Tehran’s lucrative oil and gas sector, including refining.

The mounting sanctions are aimed at putting financial pressure on the world’s fifth largest crude oil exporter, which has little refining capacity and has to import about 40 percent of its gasoline needs for its domestic consumption.

(Writing by Parisa Hafezi; Editing by David Cowell)

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Cap n Trade Out for the Count

Conoco, Caterpillar, BP Quit Alliance For Cap-And-Trade

Sen. James Inhofe, R-Okla., a leading critic of cap-and-trade,”with cap-and-trade virtually dead this year and the credibility of the U.N.’s global warming science collapsing, it is no surprise that companies are questioning whether job-killing global warming legislation — no matter how beneficial to their own bottom lines — is really a sound policy after all,” Inhofe said in an e-mailed statement to IBD.

ConocoPhillips (COP), BP (BP) and Caterpillar (CAT) all said Tuesday that they would be pulling out of the U.S. Climate Action Partnership, a coalition of green groups and leading corporations pushing for a cap-and-trade bill to curb emissions of carbon dioxide.

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The three corporations themselves all indicated that their leaving was based on disputes within USCAP over the direction the legislation was taking in Congress. They argued that it was now tilted towards coal-based energy producers. They feared that the latest version of the global warming bill would have been bad for their bottom line.

“The transportation industry carries a disproportionate burden of the cost and the emissions reductions,” said Ronnie Chappell, a spokesman for energy giant BP, formerly British Petroleum. He added that the bill didn’t do enough to promote natural gas.

Conoco, a major producer of natural gas, had similar complaints. Spokeswoman Nancy Turner put it this way to IBD: “Critical work” was being done on the bill regarding the transportation industry, and that was why Conoco left the coalition. “House climate legislation and Senate proposals to date have disadvantaged the transportation sector and its consumers, left domestic refineries unfairly penalized versus international competition, and ignored the critical role that natural gas can play in reducing GHG emissions,” [CEO Jim] Mulva continued. “We believe greater attention and resources need to be dedicated to reversing these missed opportunities, and our actions today are part of that effort. Addressing these issues will save thousands of American jobs, as well as create new ones.”

A couple weeks ago, Arizona decided to withdraw from the Western Climate Initiative, which plans to enact a regional cap and trade system between several American and Canadian states. Last week the Wall Street Journal reported that Utah is also considering removing its support. Further, only four of the 11 members of the WCI have started work on the system, and even climate-friendly California is considering a moratorium. Assemblyman Dan Logue, R-Chico, is pushing an initiative to halt California’s cap-and-trade program until unemployment in the state drops below 5.5 percent. It is 12.4 percent now. Unemployment was last as low as 5.5 percent in April 2007.

ConocoPhillips has decided to focus on developing natural gas, a lower-emission fuel, to reduce emissions and create jobs.

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