Authors: Maha El Dahan and Yusuf Saba
DUBAI, March 10 (Reuters) – Saudi Arabian Oil Co, the world’s largest oil exporter, said on Tuesday that if a war with Iran continues to disrupt shipping in the Strait of Hormuz, it will have “catastrophic consequences” for world oil markets.
The disruption is not only upending the shipping and insurance industries, but could also have a dramatic domino effect on aviation, agriculture, automobiles and other industries, Aramco Chief Executive Officer Amin Nasser told reporters on an earnings call.
Nasser noted that global oil inventories were at their lowest levels in five years and said the crisis would cause oil inventories to decrease at a faster rate, adding that resuming shipping in the strait was crucial.
“This will have catastrophic consequences for the world’s oil markets, and the longer the disruption lasts, the more serious the impact will be on the global economy,” he said.
Nasser also said a small fire that started last week during an attack on Saudi Aramco’s largest domestic Ras Tanura refinery was quickly extinguished and brought under control, adding that the refinery was being restarted.
Iran’s Revolutionary Guards said on Tuesday they would not allow “one liter of oil” to be shipped from the Middle East if the United States and Israel continued attacks, prompting President Donald Trump to warn that the United States would crack down harder on Iran if it blocks exports from the key energy-producing region.
His comments came after Saudi Aramco reported a 12% drop in annual profits due to lower crude prices. It also announced it would buy back up to $3 billion worth of shares in an initial buyback.
(Reporting by Yousef Saba and Maha El Dahan; Writing by Nadine Awadalla; Editing by Edwina Gibbs)