Bloomberg News

Saudi Arabia Can’t Fully Replace Iran Oil, Qasemi Says

April 17, 2012

Saudi Arabia, which increased crude output in recent months, can’t replace Iranian exports in the long-term, Iran’s oil minister told Press TV.

“This is not possible and even if it was possible, it would be on a temporary basis and it will have negative effects in future,” Rostam Qasemi said yesterday in an interview on the state-run channel that was published on its website today.

The world’s biggest crude exporter increased oil production to near the highest in three decades as the U.S. and European Union impose sanctions against purchases of Iranian oil in an attempt to halt the Islamic republic’s nuclear program. The kingdom is not happy with current prices and will use its spare capacity to meet any additional required volumes, Saudi Oil Minister Ali al-Naimi said April 13.

Saudi Arabia told Iran at the last meeting of the Organization of Petroleum Exporting Countries that it wouldn’t replace Iranian crude in the world market, yet the kingdom’s new policy shows the contrary given that Saudi Arabia has said it’s ready to replace Iran’s oil, Press TV cited Qasemi as saying.

Iran’s crude production and exports haven’t fallen amid embargoes from Europe and the U.S., he said. The sanctions have created tension in the world market, causing prices to rise and hurting Europe’s economy, Qasemi said.

To contact the reporter on this story: Ayesha Daya in Dubai adaya1@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net


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