The oil price rose on Thursday, heading for its largest weekly increase in a month, as the market prepared for potential disruption to crude flows from major exporter Iran in the face of US sanctions.
The US plans to impose new sanctions against Iran, which produces about 4 percent of global oil supplies, after abandoning an agreement reached in late 2015 that curbed Tehran’s nuclear activities in exchange for removal of US and European sanctions.
Brent crude futures rose 27 cents to $77.48 a barrel by midday in London, having gained 3.5 percent so far this week.
US West Texas Intermediate crude futures were up 45 cents at $71.59.
The oil price is at its highest since late 2014 and on track for its fourth consecutive quarterly gain, the longest such stretch for more than 10 years.
Analysts had little hope that opposition to the US action would prevent sanctions from going ahead.
“Europe and China will not fight against the US sanctions. They will grumble and accept it. There is no one who will realistically choose Iran over the US,” said energy consultancy FGE.
“We believe the previous 1 million bpd limit for exports (imposed during previous sanctions) will be reimposed. As before, it may take several rounds of reductions to reach target levels,” FGE’s founder and chairman Fereidun Fesharaki wrote in a note.
Even without disruption to Iran’s crude flows, the balance between supply and demand in the oil market has been tightening steadily, especially in Asia, with top exporter Saudi Arabia and No.1 producer Russia having led efforts since 2017 to cap output to prop up prices.
Saudi Arabia is ready to offset any supply shortage but it will not act alone to fill the gap, an OPEC source familiar with the kingdom’s oil thinking said on Wednesday.
“What the full impact on Iranian flows will be is still difficult to estimate,” Petromatrix strategist Olivier Jakob said.
One factor that could partially mitigate any shortfall from Iran is soaring US oil output.
The EIA on Tuesday raised its forecast for US output in its monthly report to 12 million bpd late next year. The agency has raised its forecasts every month since last August.
This would make the US the world’s largest producer, ahead of both Russia and Saudi Arabia.
Oil heads for biggest weekly rise in a month as Iran sanctions loom
Oil heads for biggest weekly rise in a month as Iran sanctions loom
- Brent rises 27 cents after 3.5 percent gain this week
- Oil at highest since late 2014
Saudi Arabia offers 11 mining sites in Eastern Province to boost investment
JEDDAH: Saudi Arabia has opened 11 mining sites at the Eastern Province’s Al-Summan Crushers Complex for competitive bidding, boosting investment, governance, and local community development.
The sites are designated for the extraction of aggregates and crusher materials, covering 9 sq. km, according to a statement by the Ministry of Industry and Mineral Resources.
The initiative forms part of the Kingdom’s drive to establish mining as the third pillar of its industrial economy, alongside oil and petrochemicals, leveraging mineral wealth now estimated at SR9.37 trillion ($2.5 trillion), a 90 percent increase from 2016 estimates of SR5 trillion.
The increase follows comprehensive surveys of the Arabian Shield, which revealed new deposits beyond traditional mineralized belts.
Jarrah bin Mohammed Al-Jarrah, the ministry’s official spokesperson, said applications for the mining sites will be accepted from Feb. 15 to March 5, via the Ta’adeen digital platform, which handles registration, qualification, bidding and the announcement of winning companies.
“The Ministry aims to allocate mining complexes to encourage investment in the mining sector, strengthen governance, protect sites from illegal exploitation, and support development in neighboring areas,” the statement said.
Saudi Arabia’s mining sector has demonstrated sustained growth, with the number of mining licenses rising from 1,985 in 2016 to 2,401 by the end of 2024, representing cumulative growth of 21 percent, according to the 2024 Mineral Wealth Statistics from the General Authority for Statistics.
Building material quarries accounted for the largest share of permits, rising from 1,267 in 2021 to 1,481 by 2024.
Exploration licenses also showed consistent growth, supporting the Kingdom’s broader strategy to develop its mineral resources and strengthen the mining sector as a key pillar of its industrial economy.
Reforms in the sector have attracted $32 billion in investments for projects in iron, phosphate, aluminum, and copper.
Recent surveys and discoveries, including rare earth elements, lithium, cobalt, and copper, as well as zinc and gold, highlight the Kingdom’s potential to expand into strategic industries such as electric vehicles, advanced technologies, and renewable energy.
Strategic investments and international partnerships, including projects like the Jabal Sayid rare earths site and collaborations with companies such as MP Materials, position Saudi Arabia as a global hub for critical minerals and reinforce the Kingdom’s Vision 2030 industrial ambitions.
