Brent crude futures climbed back above $104 a barrel early Thursday as Iran threatened to widen the Middle East conflict into the Indian Ocean and optimism surrounding yesterday's meetings between US and Iranian officials on the sidelines of the UN General Assembly faded.
A focal point this morning is Nikkei Asia’s interview with Saudi Aramco CEO Amin Nasser, who said Aramco is studying additional crude export routes to bypass the Strait of Hormuz.
Nasser said Aramco is conducting engineering and feasibility work on “a fourth and a fifth route” for crude exports. He did not disclose their locations.
He warned, "This crisis is not really getting better. The situation will get worse because this interruption is significant. It's not a small interruption," adding, "I don't think things are getting better."
The plan for two more oil export routes builds on the current three primary routes, one of which passes through the Hormuz chokepoint that Iran has disrupted. This comes after drone attacks earlier this month disrupted Saudi Arabia's East-West pipeline to the Red Sea, but media reports this week suggest the pipeline could restart soon at half capacity.
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