Wednesday, Jun 06, 2007

-THE EVENT -

Cyclone Gonu, the Arabian Peninsula's worst storm in the 60 years since records were first kept, is bearing down on the Strait of Hormuz, threatening to cut all transportation through one of the world's most important petroleum arteries.

-THE IMPACT-

Oil prices rose Wednesday morning. Uncertainty about the cyclone and its effects on oil production and transportation in the region helped send prices up 11 cents to $65.72 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude-oil futures were up seven cents in London at $70.52.

The Oman stock market was closed Wednesday and will not reopen until Sunday.

-THE STORIES -

OMAN

Oman Wednesday suspended oil exports, closed the major port of Sohar and evacuated tens of thousands as a weakening Cyclone Gonu roared toward the Strait of Hormuz - the world's major transport artery for Persian Gulf oil.

FUJAIRAH

The United Arab Emirates port of Fujairah, the world's third-largest shipping fuel center, halted all refueling and ship-to-ship supply operations Wednesday as Cyclone Gonu approached. Ships were being allowed to berth but other marine activities were suspended, officials said.

IRAN

National Iranian Oil Co., the producer of nearly 4 million barrels a day of crude oil, on Wednesday said there had been no reports of oil flows from the country being affected by approaching Cyclone Gonu. Loading terminals on Iran's Persian Gulf coast were also operational.

ABU DHABI

Abu Dhabi National Oil Co., the producer of almost all the United Arab Emirates' crude oil, said Wednesday that the approaching Cyclone Gonu hasn't affected operations at its oil export terminals or production facilities.

WEATHER REPORT

Tropical Cyclone Gonu continues to weaken and now has maximum sustained winds of 75 knots, the U.S. military's Joint Typhoon Warning Center said Wednesday. Gonu "is expected to continue to weaken throughout the forecast period due to interaction with land, dry air entrainment and low ocean heat content," the center said in a report issued at 0900 GMT.

(END) Dow Jones Newswires

06-06-07 1235GMT