OPEC Secretary General Doesn't Expect Closure Of Strait Of Hormuz

Monday, Jan 30, 2012

LONDON (Dow Jones)--The secretary general of the Organization of Petroleum Exporting Countries said Monday that he doesn't expect the Strait of Hormuz to be closed, but said it would be impossible to replace the oil route if a closure happens.

In recent weeks Iran has threatened to retaliate against Western sanctions by closing the Strait, through which one-third of global seaborne oil exports transits every day.

But speaking at a Chatham House energy conference, Abdalla Salem el-Badri said that, in his view: "There will be no closure of [the Strait of] Hormuz."

However, he said "it will be impossible to try to remedy the shortage" created by a blockade in the unlikely case it happens.

Alternative onshore pipelines could reroute only a fraction of the total that normally goes through the strait.

The official also said that Iraq wouldn't return to OPEC's quotas system until the "beginning or middle of next year."

-Benoit Faucon, Dow Jones Newswires; +44 77 601 777 36; benoit.faucon@dowjones.com

(END) Dow Jones Newswires

30-01-12 1240GMT