Saudi Arabia assures adequate supply as oil hits $80 a barrel

The Organization of the Petroleum Exporting Countries and its ally Russia have cut their output since January 2017 to help reduce excessive global stockpiles. (Reuters)
Updated 18 May 2018
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Saudi Arabia assures adequate supply as oil hits $80 a barrel

RIYADH: Saudi Arabia said on Friday it is consulting other oil producers in and outside OPEC to ensure the world has adequate supplies to support economic growth after prices hit $80 a barrel for the first time since 2014.
OPEC’s most influential energy minister, Saudi Arabia’s Khalid Al-Falih, said in a Twitter post that he had called his counterparts in the UAE, the US and Russia, as well as major oil consumer South Korea, to “coordinate global action to ease global market anxiety.”
Falih also said he had reassured the executive director of the International Energy Agency of “commitment to the stability of oil markets and the global economy” and that he would contact others over the next few days.
On Thursday, Falih called Indian Petroleum Minister Dharmendra Pradhan to assure him that supporting global economic growth was “one of the kingdom’s key goals,” the Saudi government said in a statement, after India expressed frustration with the recent surge in oil prices.

Oil prices held firm on Friday, with Brent crude trading at around $79.70 per barrel after the international benchmark broke through $80 for the first time since November 2014 the previous day.
The Saudi Energy Ministry said on Thursday that the kingdom together with other producers would ensure the availability of adequate supplies to offset any potential shortfalls.
India’s Pradhan had expressed concern about the negative impact of escalating prices on consumers and especially the Indian economy, the world’s third-largest oil consumer.
India is one of the world’s fastest-growing energy consumers and its oil use lags only that of the United States and China.
The Organization of the Petroleum Exporting Countries and its ally Russia have cut their output since January 2017 to help reduce excessive global stockpiles.
So far, OPEC has said it sees no need to ease output restrictions despite a fall in global stocks to the group’s desired levels and concerns among consuming nations that the price rally could lead to demand destruction.
OPEC member the UAE said on Thursday OPEC had bigger issues to consider than the impact of the US decision to withdraw from the international nuclear deal with oil producer Iran, such as Venezuela’s collapsing oil output.
US President Donald Trump has also called on OPEC to help cool oil prices, saying they were artificially high.


US poised to end waivers for 5 countries importing Iranian oil

Updated 32 min 4 sec ago
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US poised to end waivers for 5 countries importing Iranian oil

  • Japan, South Korea, Turkey, China and India were exempted from sanctions until May 2
  • Since November, Italy, Greece and Taiwan have stopped importing oil from Iran

WASHINGTON: The Trump administration is poised to tell five nations, including allies Japan, South Korea and Turkey, that they will no longer be exempt from US sanctions if they continue to import oil from Iran, officials said Sunday.
Secretary of State Mike Pompeo plans to announce on Monday that the administration will not renew sanctions waivers for the five countries when they expire on May 2, three US officials said. The others are China and India.
It was not immediately clear if any of the five would be given additional time to wind down their purchases or if they would be subject to US sanctions on May 3 if they do not immediately halt imports of Iranian oil.
The officials were not authorized to discuss the matter publicly and spoke on condition of anonymity ahead of Pompeo’s announcement.
The decision not to extend the waivers, which was first reported by The Washington Post, was finalized on Friday by President Donald Trump, according to the officials. They said it is intended to further ramp up pressure on Iran by strangling the revenue it gets from oil exports.
The administration granted eight oil sanctions waivers when it re-imposed sanctions on Iran after Trump pulled the US out of the landmark 2015 nuclear deal. They were granted in part to give those countries more time to find alternate energy sources but also to prevent a shock to global oil markets from the sudden removal of Iranian crude.
US officials now say they do not expect any significant reduction in the supply of oil given production increases by other countries, including the US itself and Saudi Arabia.
Since November, three of the eight — Italy, Greece and Taiwan — have stopped importing oil from Iran. The other five, however, have not, and have lobbied for their waivers to be extended.
NATO ally Turkey has made perhaps the most public case for an extension, with senior officials telling their US counterparts that Iranian oil is critical to meeting their country’s energy needs. They have also made the case that as a neighbor of Iran, Turkey cannot be expected to completely close its economy to Iranian goods.