The question is, do any of them have the technical ability, and crucially, the willingness, to step up? Don’t hold your breath, say oil analysts.
A potential EU ban on Russian oil could lead to a shortfall of 2.2 million barrels per day (bpd) of crude oil and 1.2 million bpd of petroleum products, according to the International Energy Agency.
Here’s a guide to what oil producers can and can’t do to compensate:
Saudi Arabia and the United Arab Emirates
The two countries have the lion’s share of OPEC’s spare capacity that is readily available, said Amena Bakr, chief OPEC correspondent at Energy Intelligence, at roughly 2.5 million bpd.
Analysts say a potential diversion of current shipments from Gulf Arabs’ customers in Asia could come at a cost.
This would only be possible “within the flexibility of these long-term contracts, or by agreement with the Asian buyers,” said Robin Mills, founder and CEO of Qamar Energy in Dubai.
Gulf oil shipments could be diverted from Asia to Europe, but that would endanger the burgeoning strategic partnership between the region and its main buyer China, analysts say.
Iraq also lacks the infrastructure to raise output and investment in oil projects can take years before fruits are reaped, analysts say.
“You have to remember that with oil, it’s just not on tap,” said Bakr. “It needs investment, and this investment takes time to take effect.”
Libya’s oil fields suffer regular disruptions from continued political tensions. In late April, its National Oil Corporation (NOC) said the nation was losing more than 550,000 bpd in oil production from the blocking of its major oil fields and export terminals by politically disgruntled groups. One refinery suffered damage after armed clashes.
The NOC temporarily lifted force majeure on one oil terminal in early May, but disruptions remain a major cause for concern.
It is “nearly impossible to rely on Libya” for spare capacity, said Alshammari, since some of its production has been offline for years amid instability and repeated force majeures on key oil fields.
The nation can contribute with up to 1.2 million bpd if US sanctions are lifted, analysts say. Data firm Kpler estimates that Iran had 100 million barrels in floating storage as of mid-February, meaning it could add 1 million bpd, or 1% of global supply, for about three months.
But the US is unlikely to “sign a bad deal with Iran just to put more oil into the market,” said Bakr.
Countries outside the region
Non-Middle East states with potential spare capacity, including Nigeria and Venezuela, also come with issues.
When it is said that a country has spare capacity, it means that it is “capable of bringing a given production within a period of 30 days for at least 90 days,” said Alshammari. For that reason, a Russian oil ban “can be detrimental to the global economy.”
“Very light US crude is not an ideal fit for the European market nor for producing more diesel which is what is really needed,” said Mills.
ISIS claims responsibility for deadly attack on Egyptian troops in Sinai
ISIS on Sunday claimed responsibility for an attack on Saturday that killed an officer and 10 Egyptian soldiers in Egypt’s Sinai peninsula, the group said on its Telegram channel.
- Background: Since 2018, the military has expanded its control over populated, coastal areas of northern Sinai, allowing for a return of some civilian activity and the development of some infrastructure. However, sporadic attacks have continued with militants seeking refuge in the desert.
- Why it matters: The attack was one of the deadliest in recent years in northern Sinai, where Egypt’s security forces have been battling Islamist militants with links to ISIS.
Qatar’s Emir to visit Tehran as nuclear talks stall
Qatar’s Emir Tamim bin Hamad Al Thani will visit Iran this week in an attempt to revive the stalled talks over Iran’s nuclear program, a source from the region briefed on the visit told CNN. “Qatar has already been assisting with the mediation efforts,” the source said, adding that “the Qataris hope to bring the parties to a new middle ground to prevent nuclear proliferation in the region.”
- Background: Iran’s foreign ministry said Monday that the EU Coordinator in Vienna, Enrique Mora, would visit Tehran to hold bilateral talks with Iran’s top negotiator Ali Bagheri Kani. Qatar’s Emir last visited Iran in January 2020.
- Why it matters: Indirect US-Iranian talks to salvage the deal have been at an impasse chiefly over Tehran’s insistence that Washington remove the Revolutionary Guards Corps, its elite security force, from the US Foreign Terrorist Organization list. The US has said it’s preparing for a future without the deal.
Saudi king to stay in hospital after undergoing colonoscopy
Saudi Arabia’s King Salman will stay in hospital for some time to rest on doctors’ advice after undergoing a colonoscopy on Sunday afternoon, the state-run Saudi Press Agency (SPA) said, citing the royal court. It said the results of the colonoscopy were fine.
- Background: SPA had reported earlier that the king was admitted to King Faisal Specialist Hospital on Saturday evening in the Red Sea city of Jeddah to undergo medical tests.
- Why it matters: The king, 86, underwent gallbladder surgery in 2020 and had the battery of his heart pacemaker replaced in March. Mohammed bin Salman, the crown prince who runs the day-to-day affairs of the kingdom, has had a strained relationship with the United States and is yet to speak to President Biden.
#Lebanonelections2022 and #Expatriate_Elections
Domestic politics took a front seat in the lives of Lebanese expats around the Middle East as they cast their votes for the country’s 2022 parliamentary elections.
Social media was flooded with images of Lebanese voters in long queues under cold weather in Europe and the scorching temperatures of the Gulf waiting to cast their ballots. One video clip that went viral showed citizens coming to the voting booth at the Lebanese consulate in Dubai with their suitcases, having arrived straight from the airport to vote before the deadline.
Overseas turnout was around 60% this year, three times higher than during the 2018 elections, Reuters reported, citing the foreign ministry. Countries like the UAE saw more than a 70% turnout with the lines stretching roughly 1 kilometer. Domestic voters will cast their ballots on the 15th of May.
Many are backing newcomers to Lebanese politics as the Levantine nation grapples with an economic collapse, its worst crisis since the 1975-90 civil war that led to mass poverty and a wave of emigration.
By Mohammed Abdelbary
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