Saudi, Russia have taken oil market ‘hostage’: Iran

OPEC, Russia deserve praise for preventing oil spike: Perry

LONDON, Sept 15, (RTRS): Iran’s OPEC governor said on Saturday that Saudi Arabia and Russia have taken the oil market “hostage” as US President Donald Trump seeks to impose fresh sanctions on Iranian oil sales.

Washington wants to cut Iran’s oil exports to zero by November, and is encouraging producers such as Saudi Arabia, other OPEC members and Russia to pump more to meet the shortfall.

“Russia and Saudi Arabia claim they seek to balance the global oil market, but they are trying to take over a part of Iran’s share,” Hossein Kazempour Ardebili was quoted as saying by SHANA, the oil ministry’s news agency.

“Trump’s efforts to cut Iran’s access to the global crude market has prompted Russia and Saudi Arabia to take the market hostage,” he said.

Kazempour Ardebili told Reuters on Friday that the United States will find it difficult to cut Iran’s oil exports completely as the oil market is already tight and rival producers cannot make up the shortfall.

On Saturday he accused Moscow and Riyadh of welcoming sanctions against Iran for their own gain, and warned that such actions would damage the credibility of OPEC.

“Saudi Arabia and UAE are turning the OPEC into a US tool,” he said.

Under pressure from Trump to lower oil prices, the Organization of the Petroleum Exporting Countries and allies agreed in June to boost production, having participated in a supply-cutting deal in place since 2017.

While OPEC production has increased since then, Saudi Arabia has added less crude than it initially indicated.

Saudi Arabia, other members of OPEC and Russia are to be admired for trying to prevent a spike in oil prices, US Energy Secretary Rick Perry told reporters after meeting Russian Energy Minister Alexander Novak in Moscow.

US sanctions on Iran’s energy industry, which come into force in November, have already cut supply back to two-year lows, while falling Venezuelan output and unplanned outages elsewhere will also keep the supplydemand balance tight, the International Energy Agency said on Thursday.

“The kingdom (Saudi Arabia), the members of OPEC that are opting their production to be able to make sure that the citizenry of the world does not see a spike in oil price ... are to be admired and appreciated, and Russia is one of them,” Perry said.

The United States, Russia and Saudi Arabia are also working together to make sure the world has access to affordable energy, he added.

Oil prices fell on Thursday, slipping back from four-month highs as investors focused on the risk that emerging market crises and trade disputes could dent demand even as supply tightens.

Russia’s Novak said earlier this week that his country could raise output if needed and warned of uncertainty on the market due to the upcoming U.S. sanctions against Iran’s oil exports.

In September, the Middle Eastdominated Organization of the Petroleum Exporting Countries and a group of non-OPEC producers, including Russia, will meet in Algeria to discuss the market situation.

During the meeting with Perry, Novak said he proposed creating a joint investment fund to develop new projects, adding the Russian Direct Investment Fund (RDIF) could be part of such a fund.

The RDIF supports this idea and will propose possible parameters for such an arrangement soon, it said in a statement.

Perry and Novak also touched on the topic of gas pipeline project Nord Stream 2. In July, Washington repeated a warning to Western firms invested in the pipeline that they were at risk of sanctions, saying Moscow was using the project to divide Europe.

Novak said it was a “commercial project”, which Russia hoped would continue to be developed and that the United States would approach rationally.