Saudi Arabia Prepares for War-Driven Oil Surge
Saudi Arabia's Oil Minister Ali Al-Naimi has revealed that his country could increase oil production by up to 2.5 million barrels per day in the event of a war with Iraq, citing uncertainty and potential consequences as the main drivers behind rising oil prices.
In an interview with the Financial Times, Al-Naimi stated that current oil production is around 8-8.1 million barrels per day, which is below Saudi Arabia's capacity of 10.5 million barrels per day.
The minister dismissed claims that output curbs by OPEC members had contributed to the recent surge in oil prices, saying instead that the uncertainty surrounding a potential war was causing prices to rise.
An analyst at GNI-Man Financial commented on Al-Naimi's remarks, stating that they could help explain why US supplies have remained at depressed levels despite expectations of an increase.