Oil will be delivered - war or no war

Saudi Arabia will keep delivering oil “whatever happens” during a war in Iraq, the country’s oil minister said today.

“Oil is no longer a weapon,” Ali Naimi said during a visit to Berlin.

“A war is looming – that obviously has consequences for the markets, but there is enough oil. We can deliver – whatever happens.”

Saudi Arabia is the most influential member of the Organisation of Petroleum Exporting Countries (OPEC).

OPEC signalled last week that it would pump more oil to make up for any disruption in supply caused by a war, but decided to keep its official output steady for now.

Saudi Arabia is believed to have as much as 50 million barrels in storage in the country and more en route to other storage facilities.

That would be enough to replace Iraq’s 1.5 million to two million barrels a day for about a month.

Iraq has the world’s second-largest oil reserves, after Saudi Arabia.

But the bulk of its exports are currently overseen by the United Nations under the so-called “oil-for-food” programme – a situation that would be likely to change if Saddam Hussein’s government is toppled.

However, Naimi said “the market certainly won’t be flooded with Iraqi oil.”

“In order to raise Iraq’s production significantly, billions in investment would be needed,” he said.