Saudi Aramco’s CEO Amin Nasser said the company has the expertise and infrastructure it needs to maintain the flow of crude oil in the event supply is disrupted through the Strait of Hormuz.
“We are increasing our readiness. We can supply through the Red Sea and we have the necessary pipelines and terminals,” Nasser said in an interview in the South Korean capital Seoul, published by Bloomberg yesterday.
Brent crude oil has jumped 8 per cent since mid-June amid deteriorating US-Iran relations, raising fears that shipments could be disrupted through the Strait of Hormuz, through which one-third of the world’s crude oil is transported by sea.
“It’s a concern for the whole world because that is an important supply route for a lot of crudes, not only from Saudi Arabia,” Nasser said.
Recently, a series of attacks have been carried out on oil tankers, along with the shooting down of a US unmanned aircraft which US officials have blamed on Iran.
Last Friday, international airlines suspended flights over the Strait of Hormuz.
On Monday, US President Donald Trump expressed in a series of tweets his displeasure at what he called “the United States’ protection of maritime routes free of charge for years” in the Strait of Hormuz, calling on the world, especially China and Japan, “to protect their own vessels.”
Saudi Aramco operates a pipeline with the capacity of 5MMbpd to transport crude oil for 1,200 kilometres between the Gulf and the Red Sea, from both sides of the country. Since Saudi Arabia exports around 7MM bpd, it needs to find other means of delivering the remaining oil.
Nasser said that Aramco continued to pump crude oil during the Iran-Iraq war and the Gulf War and that it would benefit from this experience to maintain the flow of oil supplies.
“We have always met our commitments to our customers. So, we have a track record of building enough flexibility in the system to manage a situation or a crisis,” said Nasser.
Nasser is currently on a visit to South Korea with a Saudi delegation including Crown Prince Mohammad bin Salman.