US Quits Iran Deal, Expect Saudis to Boost Crude Oil Output
Saudi Arabia is monitoring the impact of the US withdrawal from the Iran nuclear deal on Crude Oil supplies and is ready to offset any potential shortage, but it will not act alone to fill in the gap, an OPEC source familiar with the Kingdom’s Crude Oil thinking said on Wednesday.
On Tuesday, US President Donald Trump abandoned a nuclear deal with Iran and announced the “highest level” of sanctions against the OPEC member. The original agreement had lifted sanctions in exchange for Tehran limiting its nuclear program.
“People should not take it for granted that Saudi Arabia will produce more Oil single-handedly. We need to assess first the impact if there is any, in terms of disruption, in terms of a reduction of Iran’s production,” the OPEC source said.
“We have managed to put together this new alliance between OPEC and non-OPEC. Saudi Arabia will not in any way act independently of its partners.”
The Kingdom is working closely with the United Arab Emirates (UAE), which holds the Organization of the Petroleum Producing Countries’ presidency in Y 2018 and non-OPEC producer Russia for “coordination and market consultations,” the OPEC source said.
Any action will be taken in coordination with all OPEC and non-OPEC partners, if needed.
President Trump said Tuesday that the Y 2015 nuclear deal, which lifted sanctions on Iran in return for measures restricting its nuclear program, did not go far enough in removing the threat posed by Tehran to the US and its allies in the Middle East.
Crude Oil prices are stable because of market stability, he said, because OPEC’s goal “is not prices but market stability and lowering storage levels.”