Straits block unlikely
Posted: 18 June 2007
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Iran is unlikely to choke off oil supplies through the strategic Strait of Hormuz waterway in the Gulf in any row with the West over its nuclear ambitions, says a top International Energy Agency (IEA) official.
 "Frankly there is almost no likelihood Iran would have an interest in stopping supply - I don't think Iran has any interest in self-immolation," IEA deputy executive director William Ramsay told the Reuters Global Energy Summit.
Ramsay was responding to questions on the possibility of Iran stopping oil exports either by threatening merchant shipping directly or mining the waterway and wider Gulf waters.
The strait, at the entrance of the Gulf, is conduit for close to 40% of the world's traded oil. Over 13 million barrels of crude and two million barrels of oil products pass through the narrow waterway daily to world markets.
Ramsay said that apart from jeopardising revenue from direct oil sales, Tehran was reliant on heavy imports of gasoline which would discourage it from using oil as a weapon. He said the potential for a serious incident with Iran had been largely discounted by the oil market and the risk premium on a barrel of oil had been significantly reduced.
"Geopolitical tensions are still out there but Iran isn't at the forefront," he said, pointing instead to US gasoline concerns. |
