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The kingdom has a production capacity of 12.5 million barrels and is believed to be producing slightly over 9 million to 9.5 million barrels per day. Iran's warning introduces a new layer of complication to an issue that has the potential for broad regional and global fallout. "If the regional countries ... say no to what is harmful to the security of the region, then nothing will definitely happen," he said. But if the security of oil traffic in the Strait of Hormuz is violated, "all will be lost," he said. "If these countries make a mistake and give the green light, this will be a historic green light," Khatibi said. Saudi Arabia, the Arab world's largest economy, is widely seen as the main counterweight to Iran in the region. Any attempt by Iran to close the Strait of Hormuz, through which a sixth of the world's oil flows, would also affect the export abilities of the major Gulf producers, including Saudi Arabia, Iraq, the United Arab Emirates, Kuwait and Qatar. While momentum appears to be building for the sanctions by the West, China, another major buyer of Iranian oil, has come out against the measures. Chinese Premier Wen Jiabao was in Saudi Arabia on Saturday for meeting with officials in which the two countries "pledged to work together to further expand all-around exchanges and cooperation," according to China's Xinhua news agency Wen said the two sides "should expand trade of crude oil and natural gas and energy-related cooperation as to deepen their energy partnership," Xinhua reported. During the visit, Saudi state-owned oil giant Aramco and Chinese refiner Sinopec finalized an agreement to develop a 400,000 barrel per day joint venture refinery in the Red Sea city of Yanbu. The deal is just one between China and Gulf producers as the Asian powerhouse reaches out across the world to secure energy supplies for its booming economy.
[Associated
Press;
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