LONDON: Oil prices fell on Tuesday after Saudi Arabia, the world's biggest crude exporter, repeated its pledge to make up for lost Iranian output, easing supply concerns according to analysts.
Brent North Sea crude for delivery in May slid $1.58 to $124.13 a barrel in London midday trade.
New York's main contract, West Texas Intermediate crude for April, shed 88 cents to $107.21 a barrel.
"Today, crude oil prices have been under pressure amid reports that Saudi Arabia has resumed the mantle of swing producer and would seek to restore 'fair' prices by making up the Iranian short-fall," said Sucden Financial Research analyst Jack Pollard.
The Saudi cabinet on Monday released a statement vowing to "ensure adequate oil supply, stabilise (the) oil market and bring down oil prices to reasonable levels to both producers, consumers, and the petroleum industry," according to Arab News, a Saudi-based newspaper.
Saudi oil minister Ali al-Naimi had already said last week that the kingdom stood ready to cover any shortfalls of supplies in the market.
The assurances from Saudi Arabia come as the international community ramps up sanctions on Iran -- the world's fourth largest oil producer -- in an effort to make it halt its nuclear activities, which they fear include research on developing atomic weapons.
The International Energy Agency has previously said that it expects exports from Iran to fall by about 800,000 barrels per day to one million barrels in the second half of this year.
Energy-hungry nations in Asia have voiced concerns over the availability of alternative sources to replace Iranian imports cut off by sanctions.
Comments
Comments are closed for this article.