Saudis threaten oil ban to help Nigeria

Press, 29 March 1982, Page 8

Saudis threaten oil ban to help Nigeria

NZPA-Reuter London Saudi Arabia has stunned the oil industry by threatening to stop selling oil. along with the rest of 0.P.E.C., to companies that fail to restore their oil purchases from Nigeria. Nigeria, desperate for cash to pay its bills, is the weak link in a strategy by the Organisation of Petroleum Exporting Countries to defend oil prices in the prevailing glut. Buyers have told it to break G.P.E.C. ranks and cut its price or watch them walk away. Its sales have been halved in the last week to only 630.000 barrels daily,

according to the “Middle East Economic Survey.”' Specifically, the buyers told Nigeria, now at $U535.50 a barrel, to match Britain’s price. At, the week-end the knowledgeable "Survey,” a Nicosia-based trade newsletter, quoted an authoritative Saudi Arabian sourceas saying that companies had until today to restore Nigerian purchases or face unprecedented O.P.E.C. sanctions. Saudi Arabia, the other Gulf countries, and later the rest of 0.P.E.C., would blacklist them, the report said. One company involved,

Mobil, said that its Nigerian purchases were continuing unchanged from the level decided upon before the week-end. No immediate comment of substance could be obtained from the three others, Texaco and Gulf, and the AngloDutch Shell group. The "Survey” said the Saudis had held up a deal with Shell pending clarification of its position. It said that some in O.P.E.C. felt that the industry had zeroed in on Nigeria to try to wreck the whole pricing structure, based on a reference price of SNZ4 a barrel for Saudi light crude.