News24

G8 pressures Iran, ensures oil supply

2012-05-19 21:09

Maryland - Leaders of the Group of Eight major economies raised the pressure on Iran on Saturday, signalling their readiness to tap into emergency oil stockpiles if tougher new sanctions on Tehran threaten to strain supplies.

In unusually blunt language, the G8 put the International Energy Agency - the West's energy advisor responsible for co-ordinating reserves - on standby for action.

It was the clearest sign yet that US President Barack Obama is winning support for tapping government-held oil stocks for the second time in two years.

"Looking ahead to the likelihood of further disruptions in oil sales and the expected increased demand over the coming months, we are monitoring the situation closely and stand ready to call upon the International Energy Agency to take appropriate action to ensure that the market is fully and timely supplied," the G8 said in a communiqué after a summit at Camp David.

The meeting came just days before the next round of Iran talks, to be held in Baghdad. Western countries suspect Iran's nuclear programme is aimed at making a nuclear bomb, a charge Tehran denies.

The UN nuclear chief is also due to fly to Tehran on Sunday in an apparent bid to secure a deal enabling his inspectors to probe suspicions of atomic bomb research.

Unmistakable message

"All of us are firmly committed to continuing with the approach of sanctions and pressure in combination with diplomatic discussions," Obama told reporters at the presidential retreat in Camp David.

"And our hope is that we can resolve this issue in a peaceful fashion that respects Iran's sovereignty and its rights in the international community, but also recognises its responsibilities," he said.

Although it made no explicit mention of oil reserves, the message was unmistakable, analysts said.

"The word 'likely' signals further disruptions in oil markets don't need to be earth-shattering to potentially prompt action" to tap oil reserves, said Michael Levi, an energy policy fellow at the Council on Foreign Relations in New York.

Speculation has been growing that Obama would use an energy session at the G8 to seek support to tap emergency oil reserves before a European Union embargo of Iranian crude takes effect in July and tough new US sanctions come into force in late June.

Exports have already fallen by more than a fifth this year.

Exposure to criticism

The meeting also showed that this month's slump in oil prices has not deterred Obama from moving toward tapping the Strategic Petroleum Reserve (SPR) again - an unprecedented second release for a US president.

That could expose him to criticism from Republicans that he is using a national security tool to win votes this November.

Michael Froman, a senior White House aide, told reporters that although oil prices have been declining in recent weeks, they remain high. He said the G8 was committed to keeping global oil markets well supplied, but did not discuss any specific trigger that would prompt action.

"Referring to the IEA is a way to talk about the SPR, without talking about the SPR," said Levi.

Britain, France and Japan have all signalled their readiness to press ahead with a release of reserves, according to sources and media reports, although the head of the IEA and the European Union's energy chief have both recently said they see no need to act.

Germany too has resisted tapping stockpiles again, after last year's release to make up for Libya's disruption.

The statement also made an indirect reference to concerns that big producers - principally Saudi Arabia - may be running short of extra capacity to boost output further, more reason to ready emergency stocks.

12% tumble

Saudi Oil Minister Ali al-Naimi says the kingdom is pumping around 10 million barrels per day (bpd), leaving it another 2.5 million bpd in reserve. But some analysts fear it could not sustain output at that peak level.

"There have been increasing disruptions in the supply of oil to the global market over the past several months, which pose a substantial risk to global economic growth," it said.

"In response, major producers have increased their output while drawing prudently on excess capacity."

Saudi officials have highlighted the 80 million barrels it is storing at home and abroad, measures meant to assure consumer nations that it can keep the world supplied with crude without the need to tap into emergency stocks.

Tapping the reserves is not a foregone conclusion. It is unclear yet whether Obama and allies would opt to wait and see if Iran's exports fall and prices spike, or move pre-emptively to head off a speculative panic that could drive US gasoline quickly above $4 a gallon (3.78 litres).

US crude oil has tumbled 12% this month, dropping to the lowest since before a November UN report on Iran's atomic programme which kindled global fears.

Comments
  • Alex - 2012-05-19 21:42

    Kind of sad that John Travolta giving head is one of the most read articles and a petty argument over religion is one of the most commented... Meanwhile this feed is empty.

      micheal.moolman - 2012-05-20 07:32

      Yep Alex, I must agree with you on this one. The other question I still have no satisfactory answer to: Have 'they' found ANY weapons of mass destruction in Iraq? And! Does Iran have 'the bomb' and/or do the Iranians really want to invest in nuclear thecnology just to make 'the bomb'?

      spartanx93 - 2012-05-20 11:00

      @Micheal - the west is doing what it does best.... "assuming". Which is really sad at the end of day.

      fred.fraser.12 - 2012-05-20 16:13

      You guys would inform yourself. It's not difficult in the Information Age. The same IAEA that dissuade the US from invading Iraq says that the Iranian regime (distinct from the Iranian people) is hiding two nuclear facilities. Regarding Saddam, everyone knows he had WMD's. He gassed thousands of Iraqi Kurds to death, including women and children.

  • Gaby - 2012-05-19 22:19

    @Alex we dont know what to say. In the back of our minds we are all wondering about those non-existent weapons of mass destruction. Then there's the issue of why they get to decide who is allowed to have nuclear weapons... Now if the article was about how to make the best cup of tea, I'm sure there would be hundreds of comments:)

      fred.fraser.12 - 2012-05-20 16:20

      Again, everyone knows Saddam had WMD's. He gassed thousands of Iraqi Kurds to death, including women and children. This is recorded fact. The main nuclear powers are reducing their nuclear weapons. Have been for years. Yet the Iranian regime (distinct from the Iranian people) wants to go counter-trend. The IAEA, which was dissuading the US from invading Iraq after the shock of 9/11, is specifically saying that the regime is hiding two nuclear facilities. The regime adjusts elections to hold onto power. It is illegitimate, untrustworthy. It should not be believed just because it says it is not developing nuclear weapons. Even the autocratic Russian regime, which is part of the G8, is against the regime acquiring nuclear weapons.

  • thozi - 2012-05-19 23:21

    @Gaby. There are some retaurants that make the best teas, but I've discovered that they get to be famous for their coffees instead. My preference is Rooibos though, with a bit of fresh milk.

  • Joseph - 2012-05-19 23:48

    Islamic Iran once again the your enemies the west are plotting every skeem possible to bring you to your knees. Their plans will not prosper. In the 1980's they encouraged Sadaam to invade Iran and supplied him with arms to attack you. They even gave him chemical weapons which he even used against his own people. They didn't win then and they will most certainly not win now. Long live the Islamic Republic

      AnthonyfromAfrica - 2012-05-20 00:14

      Joseph, Either you prefer to confuse, or you are totally ignorant ! The Iran nuclear issue, is not only the West against Iran. It is the world, including Russia and China against Iran!!!! They have TOGETHER decided , Iran will NOT get nuclear weapons !! If that does not suit you; tough luck, good nite !

      Jaba - 2012-05-20 11:32

      I thought JOSEPH Goebbels was born in 1897 and died in 1945... Whats he doing on news24?

      fred.fraser.12 - 2012-05-20 16:49

      To everyone reading this post, be sure to do your own research. What people like Joseph and Anthony are saying are blatant lies to try and influence you into adopting their open anti-US and anti-West agendas. The US did not encourage Saddam Hussein to invade Iran, nor did it give him chemical weapons. These are blatant lies.

      Joseph - 2012-05-20 16:54

      @anthonyfromafrica You seem to be confused. China and Russia have stated clearly that they will not support anymore sanctions against Iran. The US even sent their diplomats to China to try and force China to not buy Iranian oil, a move which China has rejected. That is the clearest indication that China is on Iran's side. Russia has continued to warn the west against attacking Iran, it shows Russia is on Iran's side. All the members of the Non-Allied movement has expressed support for Iran's nuclear program. Venezuela also supports Iran's nuclear program so does Nicaragua and Cuba, among the Latin American countries that have publicly supported Iran's right to nuclear energy. So who is this "world" that is against Iran's nuclear program? Lets not forget that those same countries that oppose the civilian program stockpile thousands of nuclear weapons in their arsenals, including and especially the occupying and invading United States. Its not the world that is against Iran, its the US and their puppets in Europe!!!

      fred.fraser.12 - 2012-05-20 17:19

      More half-truths from you Joseph to support your not-so-hideen agenda. China's oil imports from iran have dropped substantially. It has far more to loose from opposing it's biggest trading partner, the US, than a rogue Iranian regime rights on its doorstep that is in all probability trying to develop nuclear weapons. Russia is part of the G8. Hello! It too is openly against the Iranian regime acquiring nuclear weapons. As narcissistic and dishonest as the Russian regime is, it too is reducing its nuclear weapons. It has been for years. The Non-ALigned Movement is hardly a bastion for human rights and freedoms. Venezuela, Nicaragua and Cuba. These regimes are your go-to regimes for right policies? Granted Nicaragua recently became somewhat democratic, but hardly a bellwether for right policies. No-one is against Iran, even the Iranian regime, having nuclear energy. The world, including China and Russia, is against it having nuclear weapons. Rightly so. The Iranian regime adjusts elections to hold onto power. It is illegitimate. It supports the stoning to death of women. Imagine that. It funds Jihadists and autocratic regimes such as Bashar Assad which are directly responsible for the killing and maiming of hundreds of thousands of innocent Muslims the world over. It is one of the last truly oppressive regimes left in the world. This is who you are supporting. And you're expecting others on this site to do likewise.

  • brian.bennett.7359 - 2012-05-20 08:17

    Well in my little corner of the world I don't always support every decision. But if I want to belong to the G8, UN, IMF, whatever, then whatever the MAJORITY vote is in that forum, that's the decision that they will go with. It's too bad isn't it? Much like any democratic institution, like our much punted one we have right here with the "world's most progressive constitution". Whatever the MAJORITY vote is, you really have no other choice, mmmmm? (beside getting out the old worn out soapbox - not that it'll make a difference)

      Fidel - 2012-05-20 09:19

      There's no democracy in the institutions you have outlined. It is might that rules.

      Jaba - 2012-05-20 11:34

      Fidel means the United Nations.

      fred.fraser.12 - 2012-05-20 17:05

      There's a lot of democracy in the Iranian and Chinese regimes you and Anthony openly support. Yeah right. Your arguments are so openly wrong and hypocritical, it's not even funny. Anyone with half a brain can see this.

      Fidel - 2012-05-21 08:09

      China and Iran are not "international" institutions, porkchop. Try sticking to the issue at hand.

  • Fidel - 2012-05-20 09:22

    Iran has had US-led sanctions against it for 30 years so I imagine they have developed strategies for most eventualities. The EU is a dysfunctional entity disintegrating before our eyes and they declare an oil ban?. There is no UN sanctioned oil embargo on Iran, other than the Persians challenging the petro-dollar hegemony.

      AnthonyfromAfrica - 2012-05-20 09:42

      And in the meantime, Everything is ok with China, as long as no one disrupts their OIL supply. That was like that in Libya, N and S Sudan, ( Syria ) and very much Iran !! It does not matter if it costs ten thousand lives or a hundred thousand, just don't f.ck with the Chinese economy, cause if this gets negatively effected, that will be the end of China, as we know it !!

      Fidel - 2012-05-20 09:52

      Even the word CHINA makes me happy! There is someone powerful enough to challenge everything I hate about the west.

      AnthonyfromAfrica - 2012-05-20 10:10

      "Challenge" !!! What are you on about ? They don't challenge, that's the whole point, they just go along with EVERYTHING, as long as it does not hurt their economy !! Powerful!! In reality they are weak as p.iss!! Wake up, put your silly anti Western blinkers away, and than 'maybe' you will understand, the basics what's going on in our world !!!

      Fidel - 2012-05-20 10:30

      China weak? If that were the case western hawks would have been bombing both Iran and Syria as we speak. I can see you have absolutely no idea how China works and has worked for most of the last 2500 years. China is the world’s oldest, most powerful, economically robust nation of all time. It's spent most of that last 2.5 millennia as the most powerful country on earth with India coming in a close-ish second. It's only been in the last few hundred years that China went backwards in this regard, and as of this decade we can see it moving again into ascendancy. Frankly, I'm glad China, as the next global super power, isn't throwing its weight around in the international community in the same way as America has done! Just look at how doing so has affected the human rights of people in the Middle East and third world... My anti western stance regarding geo-politics is justified. History has taught me so.

      AnthonyfromAfrica - 2012-05-20 11:10

      China, is also a country, that spends every year , 800 BILLION US, spying on its own people and to see no one steps out of line !!! If you believe, that this is sustainable, you will believe anything !!! It is also the ONLY country in the world,who puts a blind man under house arrest. It can hardly get more insane !!!

      AnthonyfromAfrica - 2012-05-20 11:17

      And if you really believe, any Western nation, wants to bomb Syria, than you simply don't have a clue what's happening in the ME. But than when one looks at your heroes, Chavez, gaddafi, mugabe, Ahmadinejad, Putin, assad, No wonder you are confused !!!

      Fidel - 2012-05-20 11:40

      Assume what you like about my character, but let's try sticking to the issues. If you disagree, then say so, no need to make any assumptions or jokey references to Mugabe, etc. We can only hope that a re-emergence of a multipolar world will curb America's worst excesses and that China's relative isolationism will keep her at home.

      Jaba - 2012-05-20 11:43

      This is why it will be China that will attack Iran at the end - not the West. If Iran hurts China's largest consumer base - the Chinese will make the fanatical religious Iranian regime pay for the losses. China can get their oil from one of 50 different countries that could supply them. However their customer base in the west, where over 70% of Chinese goods are sold, will have to be protected at all cost. China will have to keep over 200 million Chinese in their current jobs as first priority.

      Fidel - 2012-05-20 12:19

      China doesn't do things the western way, therefore western assumptions often don't apply, therefore people like you often do not understand. Confucius said a thousands years ago you don't impose to others what you don't want to impose to yourself. Can't you understand these plain words?

      joeballito - 2012-05-20 13:40

      Shame Fidel,you living in such a fools world.....America is 20 years ahead of China,they will never catch up.China powerfull? They dont even have an arcraft carrier....I believe they now trying to build one from an old tub... The big question is quite simple.Why does iran not allow IAEA to inspect their facilities?ahmajinidad calls us all infidells but he is the devil .....

      Fidel - 2012-05-20 13:51

      China doesn't have to match the US militarily in order to project its global power. Don't make the mistake of thinking just because something hasn't been articulated there isn't a fully fledged 'global vision' working below the surface. The Chinese don't need to articulate anything to achieve their ends. Look at the history of the Chinese people - it tells you all you need to know about how they see the future of their Nation. The biggest mistake the Soviet Union made was entering into an arms race with Washington. China will not make this mistake. The key to nuclear weapons is this.

      Dylan Dario Sciarappa - 2012-05-20 15:47

      At least china while obviously not perfect don't claim to have a foreign policy which promotes so called 'freedom and democracy' they only look to protect there national interest. The us on the other hand claims to have the interest of the people of the world at heart they claim to promote freedom democracy for all. It's a joke really. The us govt along with banking institutions oil companies and military industrial complex couldn't care less about anyone, they seek complete global control through regime change in any country who opposes them first through sanctions and political pressure then military action if need be. They have become experts at selling wars to the american people and the world at large by demonising anyone who doesnt do as they are told and branding them as so called terrorists. and have been doing it since after ww2. One only need look at south America the middle east and eastern Europe and Africa is next. I'm not a religious person but one passage in the bible always rang true to me ' beware the wolf in sheeps clothing' There can be no doubt that the us military has killed more innocent civilians than any of the most brutal autocratic regimes the world has seen over the last 70 odd years. The scary thing is its a debt ridden empire in decline, while the us is 16 trillion dollars and counting in debt china has a cash surplus of around 300 billion dollars, so as the Petro dollar disappears we may see the us become ever more aggressive and dangerous. Scary thought really!!!

      Dylan Dario Sciarappa - 2012-05-20 15:50

      Anthony you are freakin stupid if you don't think that the Chinese aren't powerful. Korean war anyone? The Chinese had the americans running for the hills.

      fred.fraser.12 - 2012-05-20 16:55

      The word "China" would make you happy Fidel based on your horrendous support of blatantly oppressive regimes. The Chinese regime has the worst human rights record of any country on Earth. by far. It has killed tens of millions of its own people, openly oppresses normal human freedoms, and is widely regarded as violently autocratic. But China makes you happy. Confirmation to everyone reading this thread that you're very much on the dark side of humanity, not the light.

      fred.fraser.12 - 2012-05-20 16:57

      Dylan, you believe the US attacked itself on 9/11 so wrong are you about international affairs. Thus your support of the oppressive CHinese regime is not surprising. Like Fidel, you're a bellwether for wrong thinking on international affairs.

      AnthonyfromAfrica - 2012-05-20 17:27

      Dylan, ""Anthony you are freakin stupid if you don't think that the Chinese aren't powerful"" A nation hold together by the fear of its own people; Powerful ???????? It is only a matter of time before China will implode !!!!

      Fidel - 2012-05-21 08:14

      Fred, it is the US that has undermined the human rights of millions of people around the world, from Africa to Asia to South America. The US exports its worst excesses abroad.

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