Saudi Arabia’s Ministry of Energy rejected claims that the increase in the cost of transporting Iraqi oil was linked to the country’s purchase of 25 oil tankers.
The ministry issued the statement in response to comments made during a session of the Iraqi Parliament by Iraqi Oil Minister Bassem al-Abbadi and Ali al-Shatri, chairman of the board and managing director of the State Organization for Marketing of Oil (SOMO).
The statement said Saudi Arabia had not purchased 25 tankers and that the claim was untrue. Riyadh also said it had the right to make commercial and investment decisions in line with its own needs and interests.
Freight and insurance costs rise
Saudi Arabia’s Ministry of Energy said the sharp increase in the cost of transporting Iraqi oil could not be attributed to the purchase of tankers. The ministry said regional military tensions, announced Iranian attacks on ships and disruptions to maritime traffic in the Strait of Hormuz had increased risks in maritime transport.
According to the statement, the higher risks drove up insurance costs while reducing the number of tankers willing to operate in the region. As a result, regional freight costs reached exceptionally high levels.
The ministry said the approach of linking the increase in Iraqi oil transportation costs to Saudi Arabia’s purchase of tankers did not reflect the real causes of the rise.
Rising tensions around the Strait of Hormuz
Saudi Arabia’s Ministry of Energy said in its statement that the United States had carried out military strikes on several sites in Iran and that negotiations between the two countries had become more difficult because of disputes over maritime transport in the Strait of Hormuz. The Strait of Hormuz was described as one of the strategically important routes for energy and commodity shipments.
Iran also announced that it had targeted U.S. military facilities and equipment in several Arab countries, including Saudi Arabia. The statement said civilians had been killed and civilian facilities damaged in some of the attacks. It added that the countries targeted had condemned the attacks and called for them to stop.
Saudi Arabia’s Ministry of Energy also said that the United States and Israel had launched a war against Iran on February 28, after which Iran carried out attacks on Israel and on what it described as American targets in the region.
