RIYADH/BAGHDAD, 3 June — Saudi Oil Minister Ali Al-Naimi said yesterday Saudi Arabia was ready to compensate for any shortfall on the world market after Iraq announced a halt in oil exports from June 4. “Saudi Arabia is prepared, along with OPEC members and other large crude producer countries, to make up for the shortfall that Iraq will cause if it implements its decision to halt crude exports,” he told reporters in Riyadh.
Naimi said that “Saudi Arabia together with the member states of the Organization of Petroleum Exporting Countries had the capacity to make up for the shortfall of around 2.2 million barrels, which was regularly exported by Iraq under the UN supervision”.
“The Kingdom alone, the world’s largest oil producer, had the capacity to produce an extra two million barrels per day on the market in an emergency situation,” he said, while reiterating his concerns about the Iraqi decision, which may lead to fluctuation in oil prices, supply and demand on the global level.
It is widely believed that the Kingdom, Iran, Kuwait, the UAE and Qatar have the resources to produce what the world will need from them, said an oil expert while commenting on the latest situation. At the moment, Saudi Arabia has been producing 7.8 million bpd under a broad framework agreement endorsed by all member states of OPEC. To this end, it may be noted that the OPEC will hold its ministerial meeting in Vienna on June 5-6 to decide the future course of action.
Iraq said earlier yesterday it would halt oil exports from tomorrow in protest against a United Nations Security Council resolution extending the UN’s oil-for-food program for 30 days instead of the usual six months. “Iraq will halt exports of crude oil from ports on the Arab Gulf and the Mediterranean as of 8:00 a.m. local time (0400 GMT) until further notice,” the official Iraqi news Agency (INA) quoted a source at the Oil Ministry as saying. Iraq is angry that the Security Council voted on Friday to extend the oil-for-food program for a stop gap period of one month while it considers a proposal by Britain and the United States to revamp decade-old sanctions against Baghdad.
