The following is an excerpt from Mahmoud Habboush , Anthony Dipaola , and Tracy Alloway | May 13, 2018 | Bloomberg.com |
OPEC has enough spare production capacity to cushion oil markets if the U.S. re-imposes sanctions on Iran, according to United Arab Emirates Energy Minister Suhail Al Mazrouei.
Three members of the Organization of Petroleum Exporting Countries -- Saudi Arabia, Kuwait and the U.A.E. -- together have enough capacity, Al Mazrouei said in an interview with Bloomberg Television in Abu Dhabi. He serves this year as OPEC’s president.
“Don’t worry about supply,” Al Mazrouei told reporters later in Abu Dhabi. “I don’t think there will be issues as a result of sanctions.” OPEC has an adequate “buffer” of potential output, he said.
President Donald Trump announced plans last week to withdraw from the Iran nuclear accord and re-impose U.S. sanctions on OPEC’s third-biggest producer. Trump’s decision presents a challenge for OPEC and allied suppliers as they cut output to drain a global glut. Their policy of cutting until the end of the year may falter in the wake of Trump’s decision. While it’s still uncertain how much he intends to restrict Iranian oil exports, most analysts predict a decrease.
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