WPC: Saudi Arabia pledges readiness to stabilize oil prices in case of US-Iraq war
Saudi Arabia has reiterated a commitment to unilaterally make up any shortfall in global oil supply in the event of a US-led attack on Iraq.
By an OGJ correspondent
Rio de Janeiro, Sept. 3 -- Saudi Arabia has reiterated a commitment to unilaterally make up any shortfall in global oil supply in the event of a US-led attack on Iraq.
"In case of an US attack upon Iraq, there would be no world oil shortage, since in a short time Saudi Aramco could make available an additional 3 million b/d of oil, aside from its present 7 million b/d output," said Abdallah S. Jum'ah, president and CEO of the state owned Saudi company, at the World Petroleum Congress in Rio de Janeiro this morning.
Jum'ah made the comments at a press conference following a presentation to WPC delegates on the topic of social responsibility and the petroleum industry, a theme recurring throughout the 5-day congress (OGJ Online, Sept. 2, 2002).
He added that the company could ship 5 million b/d through the Red Sea and has crude oil in storage totaling 5 million bbl in the Caribbean Sea region and 3 million bbl in Rotterdam, possibilities available in case of a worst-case scenario.
Restoring price stability to the world market is seen by Jum'ah as part of Saudi Aramco's commitment to social responsibility. He cited similar precedents:
-- "During the Iranian revolution of 1979 and the Iran-Iraq war of 1980, Saudi Aramco rapidly filled the gap.
-- "Again during the (Persian) Gulf crisis of 1990, the company alone promptly added more than 3 million b/d to the world's supply."
"Without these timely interventions to stabilize prices, there would have been an abrupt supply shortage that could have sent the world into an economic tailspin," Jum'ah added.
According to Jum'ah , Saudi Arabia holds some 260 billion bbl of oil, about a quarter of the world's total and is the world's largest producer of oil.
Foreign investment prospects
Jum'ah also noted that, during his stay in Brazil, the company will be looking for possible investment opportunities in that country's downstream sector. That initiative ties in with Saudi Aramco's policy to expand its downstream presence throughout the world.
The company has four important international partnerships: with Royal Dutch/Shell Group in the US (Motiva Enterprises LLC), in South Korea (S-Oil Corp.), in the Phillipines (Petron Corp.), and in Greece (Motor Oil .[Hellas] Corinth Refineries SA).
There also talks under way with China concerning investment in a new refinery, Jum'ah added.