Top oil exporter Aramco sees ‘catastrophic consequences’ if Strait of Hormuz remains closed
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A small fire broke out at Aramco's biggest domestic refinery last week after an attack, although it was extinguished and brought under control quickly.
PHOTO: REUTERS
DUBAI – Saudi Arabia’s Aramco, the world’s top oil exporter, said on March 10 that there would be “catastrophic consequences” for the world’s oil markets if the Iran war continues to disrupt shipping in the Strait of Hormuz.
The disruption has not only upended the shipping and insurance sectors but also threatens a drastic domino effect on aviation, agriculture, automotive and other industries, Aramco chief executive Amin Nasser told reporters on an earnings call.
Mr Nasser noted that global oil inventories were at a five-year low and said the crisis would lead to drawdowns at a faster rate, adding that it was critical that shipping in the strait resumed.
“There would be catastrophic consequences for the world’s oil markets, and the longer the disruption goes on, the more drastic the consequences for the global economy,” he said.
Mr Nasser also said a small fire from an attack last week on Aramco’s Ras Tanura refinery, its largest in Saudi Arabia, was quickly extinguished and brought under control, adding that the refinery was in the process of being restarted.
Iran’s Revolutionary Guards said on March 10 they would not allow “one litre of oil” to be shipped from the Middle East if the US-Israeli attack continues, prompting a warning from US President Donald Trump that Washington would hit Iran much harder if it blocked exports from the vital energy-producing region.
His comments come after Aramco reported a 12 per cent drop in annual profit, mainly due to lower crude prices.
It also announced it would repurchase up to US$3 billion (S$3.81 billion) worth of shares in its first-ever buyback programme. REUTERS
