P.M. BRIEFING : Saudis Cancel Refinery Exports, Cite Demands of U.S. Military


Saudi Arabia canceled most exports of refined oil products today as the U.S. war machine began drying up regional supplies of fuel.

Saudi Arabia told customers in the Far East and elsewhere that their September contract loadings of gasoline, kerosene and gas oil would not be met because of the "current difficult situation."

Oil industry sources said naphtha and fuel oil were not affected. The kingdom has contracts to supply more than 300,000 barrels a day of refined products, mainly in the Far East.

Since Iraq's invasion of Kuwait Aug. 2, the United States has built up a massive arsenal of tanks, armored vehicles, trucks, helicopters and aircraft in Saudi Arabia.

"The crude is there, and they have enough refineries in Saudi Arabia to produce most of the military needs," an oil industry executive in the gulf said.

Refineries in Bahrain, Qatar and Abu Dhabi also export products, but it was not immediately clear if these sales would also stop.

Oil traders in the Persian Gulf said most product exports from the area, which fell by 600,000 barrels a day when Kuwait's refineries closed, could stop altogether.

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