“Frankly there is almost no likelihood Iran would have an interest in stopping supply — I don’t think Iran has any interest in self-immolation,” IEA Deputy Executive Director William Ramsay told the Reuters Global Energy Summit.
Ramsay was responding to questions on the possibility of Iran stopping oil exports either by threatening merchant shipping directly or mining the waterway and wider Gulf waters.
The strait, at the entrance of the Gulf, is conduit for close to 40 percent of the world’s traded oil.
Over 13 million barrels of crude and 2 million barrels of oil products pass through the narrow waterway daily from OPEC’s biggest exporters, including Saudi Arabia, to world markets.
Ramsay said that apart from jeopardizing revenue from direct oil sales, Tehran was reliant on heavy imports of gasoline which would discourage it from using oil as a weapon.
He said the potential for a serious incident with Iran had been largely discounted by the oil market and the risk premium on a barrel of oil had been significantly reduced.
“Geopolitical tensions are still out there but Iran isn’t at the forefront,” he said, pointing instead to U.S. gasoline concerns.
Ramsay, formerly of the U.S. State Department where he advised on foreign policy sanctions and energy, also said Iran and the West were not predestined to go to war.
“I firmly think that a (military) confrontation scenario is unlikely. No side has an interest in that and nobody can win that conflict,” he said.
