Saudi ready to meet rise in oil demand, says Al Naimi

Saudi Arabia is “always obliged” to meet demand, Naimi said when asked whether the kingdom has enough spare capacity to cover demand in light of possible oil sanctions by the West on Iran’s crude oil sales.

“Whatever customers want,” he said, without making a reference to the possible sanctions on Opec member Iran.

The kingdom, now pumping just under a record rate of 10 million barrels per day, or bpd, has poured billions of dollars into its vast oil fields, which on paper should ensure it has the ability to ramp up to 12.5 million bpd. Some analysts have cast doubts over Saudi Arabia’s ability to sustain untested production levels of over 10 million bpd.

“We don’t take experts’ view into consideration. They can doubt as they want. Do you believe us or you believe sceptics? We have said many times that we meet customers’ demand. Period,” said Al Naimi.

A top US Republican lawmaker echoed these remarks.

House of Representatives Majority Leader Eric Cantor spoke to Reuters by telephone from Europe after several days of meetings in the Middle East, including Saudi Arabia. Al Naimi was among the officials he met.

“The Saudi government indicated that it was ready and able to meet needs of its customers,” Cantor told Reuters. Saudi Arabia is the world’s largest oil exporter. Its top customers include the United States, Japan, China and South Korea.

Cantor was addressing concerns that oil shortages may arise from new sanctions in the offing against Iran by the United States and European Union, aimed at discouraging Teheran’s nuclear programme.

The United States has long embargoed Iranian crude, but has just approved new sanctions targeting Iran’s Central Bank, the main conduit for its oil revenues. The European Union, which collectively buys about 500,000 bpd of Iranian oil, is expected to soon impose an embargo halting imports.

The goal of the West’s increased pressure on Teheran is to stop the Islamic republic from building a nuclear weapon. Iran says its nuclear work is for peaceful purposes.

Cantor is the number two Republican in the Republican-majority House of Representatives, after Speaker John Boehner.

During his tour of the Gulf region with several other US lawmakers, Cantor also met officials from Turkey, Qatar and the UAE.

“They also expressed the ability to have excess capacity coming on line later this year, as well as the capacity it has online now,” Cantor said of the UAE.

“I think the consensus is that there is enough capacity in the region to meet the needs of customers, excluding the exports of Iran,” he said.

Cantor said he would push for the speedy implementation of the new US sanctions on Iran’s central bank, and he favoured Congress passing further measures to penalize Teheran if it does not stop its nuclear programme. —