The question is whether one of them has the technical capacity and, above all, the will to intervene? Don’t hold your breath, say oil analysts.
According to the International Energy Agency, a possible EU ban on Russian oil could lead to a shortfall of 2.2 million barrels per day (bpd) of crude oil and 1.2 million bpd of products tankers.
Here’s a guide to what oil producers can and can’t do to compensate:
Saudi Arabia and United Arab Emirates
The two countries have the lion’s share of OPEC spare capacity that is readily available, said Amena Bakr, chief OPEC correspondent at Energy Intelligence, at about 2.5 million bpd.
Analysts say a potential diversion of current shipments from Gulf Arabs customers in Asia could come at a cost.
This would only be possible “within the flexibility of these long-term contracts, or in agreement with Asian buyers”, said Robin Mills, founder and CEO of Qamar Energy in Dubai.
Gulf oil shipments could be diverted from Asia to Europe, but that would jeopardize the region’s emerging strategic partnership with its biggest buyer, China, analysts said.
Iraq
Iraq also lacks the infrastructure to increase production, and investments in oil projects can take years before the fruits are reaped, analysts say.
“You have to remember that with oil it’s just not available,” Bakr said. “It needs investment, and that investment takes time to kick in.”
Libya
Libya’s oil fields suffer from regular disruptions due to ongoing political tensions. In late April, its National Oil Corporation (NOC) said the country was losing more than 550,000 bpd of oil production due to the blocking of its main oil fields and export terminals by politically disgruntled groups. A refinery was damaged after armed clashes.
The NOC temporarily lifted force majeure on an oil terminal in early May, but the disruptions remain a major cause for concern.
It is “almost impossible to rely on Libya” for spare capacity, Alshammari said, as part of its production has been offline for years amid instability and repeated force majeure events at key fields. oil.
Iran
The nation can contribute up to 1.2 million bpd if US sanctions are lifted, analysts say. Data firm Kpler estimates that Iran had 100 million barrels in floating storage in mid-February, meaning it could add 1 million bpd, or 1% of global supply, for around three month.
But the US is unlikely to “sign a bad deal with Iran just to get more oil to market”, Bakr said.
Countries outside the region
States other than the Middle East with potential spare capacity, including Nigeria and Venezuela, are also facing problems.
When a country is said to have spare capacity, it means it is “capable of bringing in a given production within 30 days for at least 90 days,” Alshammari said. For this reason, a ban on Russian oil “may be detrimental to the global economy”.
“U.S. very light crude is not ideal for the European market or for producing more diesel, which is badly needed,” Mills said.
The summary
Islamic State claims deadly attack on Egyptian troops in Sinai
Islamic State on Sunday claimed responsibility for an attack that killed an Egyptian officer and 10 soldiers in Egypt’s Sinai Peninsula, the group said on its Telegram channel.
- Background: Since 2018, the army has extended its control over the populated coastal areas of North Sinai, allowing the return of certain civilian activities and the development of certain infrastructures. However, sporadic attacks continued, with militants seeking refuge in the desert.
- why is it important: The attack was one of the deadliest in recent years in North Sinai, where Egyptian security forces battled Islamist militants linked to IS.
Qatar’s emir to visit Tehran as nuclear talks stall
Qatar’s Emir Tamim bin Hamad Al Thani will visit Iran this week to try to revive stalled talks on Iran’s nuclear program, a regional source briefed on the visit told CNN. “Qatar has already assisted in the mediation efforts,” the source said, adding that “the Qataris hope to bring the parties to new common ground to prevent nuclear proliferation in the region.”
- Background: Iran’s Foreign Ministry announced on Monday that EU Vienna coordinator Enrique Mora will visit Tehran to hold bilateral talks with Iran’s chief negotiator Ali Bagheri Kani. The Emir of Qatar last visited Iran in January 2020.
- why is it important: US-Iranian indirect talks to salvage the deal have stalled mainly over Tehran’s insistence that Washington remove the Revolutionary Guard Corps, its elite security force, from the list of American foreign terrorist organizations. The United States has said it is preparing for a no-deal future.
Saudi king hospitalized after undergoing colonoscopy
Saudi Arabia’s King Salman will remain hospitalized for some time to rest on doctors’ advice after undergoing a colonoscopy on Sunday afternoon, the Saudi Press Agency (SPA) said, citing the royal court. He said the colonoscopy results were good.
- Background: SPA had earlier reported that the king had been admitted to King Faisal Specialist Hospital on Saturday evening in the Red Sea city of Jeddah to undergo medical tests.
- why is it important: The King, 86, underwent gallbladder surgery in 2020 and had his pacemaker battery replaced in March. Mohammed bin Salman, the crown prince who runs the day-to-day affairs of the kingdom, has had strained relations with the United States and has yet to speak to President Biden.
What is the trend
#Lebanonelections2022 and #Expatriate_Elections
Domestic politics took center stage in the lives of Lebanese expats in the Middle East as they cast their ballots in the country’s 2022 parliamentary elections.
Social media has been flooded with images of Lebanese voters in long queues in cold weather in Europe and scorching temperatures in the Gulf waiting to cast their ballots. A video clip that went viral showed citizens heading to the Lebanese consulate voting booth in Dubai with their suitcases, arriving straight from the airport to vote before the deadline.
Overseas turnout was around 60% this year, three times higher than in the 2018 elections, Reuters reported, citing the Foreign Ministry. Countries such as the United Arab Emirates have recorded over 70% participation with lines extending for around 1 kilometer. National voters will vote on May 15.
Many support newcomers to Lebanese politics as the Levantine nation grapples with an economic collapse, its worst crisis since the 1975-1990 civil war that led to mass poverty and a wave of emigration.
By Mohamed Abdelbary
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