The world's largest oil producer and exporter Saudi Arabia also stood ready to take up the slack, he said, as it had done during the 1990-91 Gulf crisis, when oil supplies from the region were severely disrupted. And the Paris-based International Energy Agency added its voice, saying it would consider opening the reserves it holds for 24 member states. The words were clearly intended to calm the markets, which have swung sharply in the past, sometimes because of threats to supplies which have been more perceived than real. At present, most analysts do not believe there is a substantial shortage of crude oil worldwide. The missing Iraqi volumes are unlikely to be enough to send prices soaring, they say.
Any shortages are more in refined products such as heating oil than in crude oil.
Most analysts also doubt that the break in supplies will be anything other than a temporary interruption. They interpret Iraq's action as another step in its campaign to have sanctions lifted. A solution satisfactory to Iraq could be found as early as next week allowing exports to resume, analysts say. Substantial ability Despite the somewhat muted market reaction on Friday, Iraq remains one of the world's major oil powers. In some circumstances it would have substantial ability to move markets, as it did in 1990-91 when invading Kuwait led to a sharp fall in both countries' exports and sent crude prices spiralling upwards.