Published: Thu, May 10, 2018
Health Care | By Alice Shelton

Saudi concerned about tight spare oil capacity - Mr Falih

Saudi concerned about tight spare oil capacity - Mr Falih

Iranian officials warned the United States against the move, saying the deal won't work without it, despite European Union efforts.

"I don't foresee any major economic impact after the sanctions being reinstated but the political impact will be felt if Trump tries to escalate a war with Tehran which would be a major challenge", said an Omani political analyst with government links who preferred to remain anonymous for fear of talking explicitly about the withdrawal to worldwide media.

Over the years reports have surfaced that Riyadh has been interested in procuring nuclear weapons.

The U.S. advised countries that want to avoid sanctions on their financial institutions to reduce their volume of crude purchases from Iran during a 180-day wind-down period.

CNN host Wolf Blitzer asked, "What will Saudi Arabia do?"

The oil price is at its highest since late 2014 and is on track for its fourth consecutive quarterly gain, the longest such stretch for over 10 years.

Arab League's (AL) Secretary General Ahmed Aboul-Gheit called on Wednesday for an urgent review on the Iran nuclear deal, AL said in a statement.

"All parties have an interest to act with restraint and wisdom in the face of this situation and to try to resolve conflicts through dialogue", its foreign ministry said.

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It would be hard to replace Iranian oil given the "commercial terms" offered by Tehran, he said.

Saudi Arabia has expressed support for the USA pulling out of the nuclear deal, saying it did not adequately address Iran's behavior in the region.

The other looming debacle is whether a U.S. pullout from the Iran deal could trigger a nuclear arms race.

The Kingdom of Bahrain has also supported the decision of Trump.

For all these reasons, Saudi Arabia and other OPEC members will come under intense pressure to raise their output to make up for any loss of Iranian barrels.

As Iran reconsiders its commitment to the deal that no longer protects it from USA sanctions, Jubeir told CNN, "I believe that if Iran restarts its enrichment program beyond what it has right now that should trigger the snapback provision and cause all the other P5 [U.N. Security Council's five permanent members] countries to abandon the deal and reimpose sanctions on Iran".

Riyadh, which leads a regional coalition that intervened in Yemen's civil war to fight the Huthis, accuses Iran of supplying the militia with ballistic missiles.

Iran, the third-largest OPEC producer, could deliver involuntary cuts to supply forced by US sanctions and Trump's exit from the nuclear deal - fundamental to the resumption of Iran as a major oil producer and exporter.

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