Crude oil prices fell as concerns over Iran's nuclear ambitions eased with a joint announcement with Russia that they would establish a joint uranium enrichment venture. Now though markets are well supplied, the potential for political instability or violence in key producing nations was limiting the price decline. Light, sweet crude for April delivery on the New York Mercantile Exchange dropped to US$62.08 a barrel in electronic trading by afternoon in Europe. April Brent crude futures on London's ICE Futures exchange fell to US$61.92 a barrel.
On Sunday, Iran and Russia agreed in principle to establish a joint uranium enrichment venture, a breakthrough in talks on a U.S. backed Kremlin proposal aimed at easing concerns that Tehran wants to build nuclear weapons. However, details whether Iran will entirely give up enrichment at home, a top demand of the West have to emerge.
On Friday, the benchmark contract gained US$2.37 a barrel after a thwarted attack by suicide bombers in explosives-packed cars on a massive oil facility in Saudi Arabia heightened supply fears. Saudi Arabia is the world's largest oil producer, with output of about 9.5 mln bpd (11% of global consumption).
More than a third of the global oil supply is prone to uncertainties.
Iraq, Nigeria, Iran, Russia, Venezuela, Colombia and Ecuador and Saudi Arabia as nations either affected or at risk.
28-Feb-06 
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