Aramco sees ‘catastrophic consequences’ for oil if shipping doesn’t resume in Strait of Hormuz
Written by: Maha El Dahan and Yousef Saba
DUBAI, March 10 (Reuters) – Saudi Arabia’s Aramco, the world’s biggest oil exporter, said on Tuesday there would be “catastrophic consequences” for world oil markets if the Iran war continues to disrupt shipping in the Strait of Hormuz.
The outage promises to not only disrupt the shipping and insurance industries but also create serious domino effects on aviation, agriculture, automotive and other industries, Aramco CEO Amin Nasser told reporters on the earnings call.
Nasser stated that global oil stocks are at their lowest level in five years, adding that the crisis will lead to a faster decline and that the resumption of shipping in the strait is critical.
“It could have devastating consequences for world oil markets, and the longer the disruption lasts, the more severe the consequences for the global economy,” he said.
Nasser also stated that the small fire that broke out last week as a result of the attack on the Ras Tanura refinery, Aramco’s largest refinery in the country, was quickly extinguished and brought under control, and added that the refinery is in the process of restarting its operations.
Iran’s Revolutionary Guard said on Tuesday that it would not allow “a liter of oil” to be shipped from the Middle East if US and Israeli attacks continue, prompting a warning from President Donald Trump that the US would hit Iran much harder if it blocks exports from the vital energy-producing region.
His comments came after Aramco reported a 12% drop in annual profit, mainly due to lower crude oil prices. It also announced that it would buy back up to $3 billion in shares in its first buyback.
(Reporting by Yousef Saba and Maha El Dahan; Writing by Nadine Awadalla; Editing by Edwina Gibbs)
