The Financial Times, in an exclusive report, says that Saudi Arabia will ship additional crude to some of the world's largest consuming nations. The kingdom fears that the increasing cost of oil will stifle what is already a troubled global economic recovery. According to the report:
Saudi Arabia wants to reduce prices while avoiding an open confrontation with Iran. Tehran has warned Saudi Arabia not to increase crude oil production to offset the impact of US and European sanctions on Iranian crude oil exports, which fell to a 22-year low of 2.85m b/d last month.
The oil market is on edge as anti-US protests spread across the Middle East and tensions rise between Israel and Iran. A large naval minesweeping drill is also being conducted by more than 20 navies including those of the US, UK and France in the Strait of Hormuz, the world's most important potential chokepoint for oil tankers.
Douglas A. McIntyre
Filed under: 24/7 Wall St. Wire, Commodities, Oil & Gas