Saudi Arabia’s Ministry of Energy has denied claims that the Kingdom purchased 25 oil tankers, saying the vessels were not acquired and that the sharp rise in Iraqi oil transportation costs was instead driven by regional security and market disruptions.
The ministry was responding to remarks made by Iraqi Minister of Oil Basim Mohammed Khudair Al-Abbadi and Chairman and Director General of Iraq’s State Organization for Marketing of Oil (SOMO), Eng. Ali Nizar Al-Shatari, during a session of the Iraqi Council of Representatives. The remarks linked the purchase of the 25 tankers to higher transportation costs for Iraqi oil.
The ministry said the Kingdom had not purchased the 25 tankers referred to and that the claim was incorrect.
It stressed that the clarification in no way affects the Kingdom’s full right to make commercial and investment decisions in line with its needs and interests.
The ministry added that the sharp rise in oil transportation costs was driven by factors different from those cited by the Iraqi Minister of Oil and the Director General of SOMO.
These factors include military escalation in the region, publicly announced Iranian attacks on vessels, disruptions to navigation through the Strait of Hormuz, sharply higher shipping risks and insurance costs, and a decline in the number of tankers willing to operate in the region.
The ministry further noted that these conditions had pushed shipping costs in the region to exceptional levels, adding that attributing the rise in the cost of transporting Iraqi oil to Saudi Arabia did not reflect the actual factors driving higher shipping costs.
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