Saudi Ready to 'Mitigate' Impact of Iran Oil Sanctions

OPEC's Barkindo Vows to Maintain Crude Market Stability, but Saudis Worry About Supply Shortage

Even without disruption to Iran's crude flows, the balance between supply and demand in the oil market has been tightening steadily, especially in Asia, and as top exporter Saudi Arabia and No.1 producer Russian Federation have led efforts since 2017 to withhold oil supplies to prop up prices.

US President Donald Trump announced on May 8 that the US was withdrawing from the Joint Comprehensive Plan of Action (JCPOA), an global agreement reached in 2015 by Iran, the United States, Russia, France, China, Great Britain, Germany and the EU.

The "Vienna" production agreement, in place since early 2017, removed 1.8 million barrels a day from the market with both Saudi Arabia and Russian Federation giving up barrels, as well as other members of OPEC and the alliance.

Trump said on Tuesday that the United States was reimposing the "highest level of economic sanctions" on Iran, but he did not provide details.

Separately, South Korea said on Wednesday it would seek U.S. exemptions to buy Iranian oil, a path many big oil consumers are likely to follow in the wake of new USA sanctions on Tehran, which will tighten world oil markets and push up prices.

Secretary of State Mike Pompeo shakes hands with his Saudi counterpart Adel al-Jubeir during a news conference, in Riyadh, Saudi Arabia, on April 29.

Several refiners in Asia said they were seeking alternatives to Iranian supplies.

USA politicians will want to avoid being blamed for a further escalation in the run up to congressional elections in November.

Cavaliers' LeBron James Calls This Year's Rookie Class 'Best Since 2003'
Certainly, when you're swept, there's plenty of blame to go around. "The things he does for his team-mates gets them going". Everyone thought they were vulnerable but as long as they have him, they have a chance and that's what we were looking at.

He also asserted that Saudi Arabia has not been that much successful to limit Iran's oil market, since the data and figures are clearly manifested the high records of crude oil exports.

The previous rapprochement between both Iran and the United States under the Obama administration is at serious risk.

"We have managed to put together this new alliance between OPEC and non-OPEC".

USA shale producers could also increase their output but it would take time and their light crude is not a good substitute for heavier Iranian oil.

Saudi Arabia, the UAE, Bahrain and Egypt imposed a trade and transport boycott on Qatar in June, accusing it of financing militant groups and cosying up to Iran - charges it denies.

America's hawks would surely take issue with that whiffle bat analogy, since Tehran has long wanted to build a nuclear arsenal.

The same source went on to add that Saudi Arabia will not fill the gap on its own, but is working on possible solutions with the United Arab Emirates (the UAE is the current holder of the OPEC presidency for 2018) and Russian Federation (as a party to the agreement between OPEC and non-OPEC oil producers). "And the Iranians must be held accountable for this", Jubeir told CNN.

Iran, which has not cut production, is an OPEC member and it has been opposed to the production deal continuing and is likely to continue to be opposed.

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