Wen is on a six-day tour of the Arabian Peninsula which analysts say is partly aimed at finding alternate oil suppliers for China [Reuters]
Saudi Arabia will make up for any shortfall in world oil supply caused by sanctions against Iran, the country’s oil minister has said, despite warnings from Iran that such a move would provoke unspecified “consequences”.
The US has already approved a sanctions bill which penalises companies for dealing with Iran’s central bank. The bank processes Iran’s oil revenues, so the law would make it impossible for many countries to buy Iranian oil.
The European Union is now considering a similar set of measures, with a final decision expected within the next two weeks.
Concerns over the effects of sanctions, and a series of provocative statements from Riyadh and Tehran, have already helped to push crude oil prices above $111.
Ali al-Naimi, the Saudi oil minister, told CNN on Monday that his country could increase production by two million barrels “almost immediately”. Iran exports roughly 2.5 million barrels per day, so that increase would make up for most of the Iranian supply.
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