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Last Updated: Wednesday, 4 April 2007, 23:46 GMT 00:46 UK
Iran news fails to dent oil price
Iranian President Mahmoud Ahmadinejad
Oil prices drifted lower after the British sailors were released
The fall in oil prices after Iran said it would release UK navy personnel has proved short lived, with crude in London actually climbing.

Light crude oil fell 26 cents to $64.3 a barrel in New York following an earlier low of $63.56 after the announcement by Iran's president.

After an initial slide, Brent crude in London rose 59 cents to $68.40, as data showed a drop in US petrol supplies.

Monday saw prices hit seven-month peaks above $69 on supply side fears.

Analysts were not surprised by the initial fall.

"This is a fairly predictable short-term knee-jerk reaction," Barclays Capital analyst Kevin Norrish.

Yet Mr Norrish warned that the West's opposition to Iran's nuclear ambitions had "not gone away".

Nigeria

Traders said the oil prices were also affected by the release of four foreign oil workers abducted last week in Nigeria, Africa's biggest crude producer.

British High Commission sources in Nigeria said a Briton, Dutch national and two Lebanese oil workers held hostage in southern Nigeria since last Saturday had been freed.

Meanwhile, stocks of petrol in the US, the world's largest energy consumer, fell by five million barrels in the week to 30 March, according to the US Energy Department, well above analyst forecasts for a 300,000 barrel drop.

Traders blamed refinery outages on the strain on petrol production.






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