UAE committed to de-escalating tensions and securing energy supply, Adnoc CEO says
He said recent attacks on oil tankers were an 'assault on the entire international community'
The UAE is committed to de-escalating tensions along the world’s busiest oil trading route and will work towards securing energy supplies for its customers, according to Abu Dhabi National Oil Company's chief executive.
“The UAE, with the sixth-largest oil reserves in the world, views very seriously any threat to security of energy supplies,” Dr Sultan Al Jaber, who is also UAE Minister of State, told the Emerging + Frontier Forum 2019 at Bloomberg's European headquarters in London on Tuesday.
"Any attack on a single tanker is an assault on the entire international community,” Dr Al Jaber said. “Now is the time for wisdom, diplomacy and the concerted efforts of the international community, as we all have an interest in stable and secure market. They are the essential foundation for economic progress.”
He said the recent attacks on tankers in the Gulf of Oman, in which a vessel carrying UAE cargo was targeted only a month after similar incidents off the coast of Fujairah, were threats to "free trade, peace and prosperity".
"That is why the UAE will work together with our friends and allies to defuse and de-escalate the current threat and help ensure regional stability and the security of energy supplies to global customers,” Dr Al Jaber said.
Nearly a third of the world’s seaborne oil passes through the Strait of Hormuz, which coveys around 18.5 million barrels per day of crude. Any conflict in the strait has the potential to upset the oil market. Much of the world’s spare capacity for crude belongs to producers that straddle the Gulf, particularly Saudi Arabia, which has, as well as attacks on its tankers, also suffered damage to an east-west pipeline.
Oil prices, which had earlier proven immune to the ongoing crisis in the Gulf, have rallied over fears of a full-blown conflict.
On Thursday, the White House said it was poised to launch an offensive against Iranian targets in response to the downing of a US drone by Tehran. Iran said the surveillance drone had been operating in its airspace.
US President Donald Trump eventually called off the strikes, fearing high civilian casualties in Iran.
However, the US administration has since been drumming up support against Tehran, with US Secretary of State Mike Pompeo on a tour of Gulf states to build a coalition against Iran. Mr Pompeo was in Abu Dhabi on Monday to step up pressure against Iran, even as Washington imposed new sanctions against the country.
Oil remained close to $65 per barrel as the US imposed restrictions aimed at Supreme Leader Ayatollah Ali Khamenei. In response to the sanctions, Iran said US actions mean the "permanent closure of the path of diplomacy".
Brent was trading at $64.8 per barrel at 1.30pm UAE time, down 0.14 per cent from the three-week high of $65.18 seen on Monday.
Iran’s exports have taken a beating, falling to 100,000 bpd in May after the US cancelled waivers to eight of its top oil importers. The move came amid Washington’s drive to reduce Iran’s exports to zero after walking away from the nuclear deal last year.
Washington has accused Iran of seeking a nuclear weapons programme, even within the nuclear deal known as the Joint Comprehensive Plan of Action, which was engineered by the Obama administration, its European allies, Russia and China in 2015. Iran has denied the accusations and has said its nuclear programme was for power and research purposes.
Updated: June 25, 2019 07:15 PM