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CNN Live Today

Interview with Roger Diwan

Aired April 08, 2002 - 14:13   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS: Back to Iraq's decree and its disruption of the export of about two million barrels of oil a day from Iraq, much of it to the U.S. So how might that affect the cost of gasoline in this country, where the price at the pump has gone up eight cents over the last couple of weeks? Roger Diwan is managing director of the Petroleum Finance Company's marketing & countries group. He's in our Washington bureau.

Roger, good to see you.

ROGER DIWAN, PETROLEUM FINANCE COMPANY: Hello.

PHILLIPS: Well, first reaction to how this is going to affect the U.S., and if maybe this might be a bit overblown.

DIWAN: It's difficult to tell yet how long this interruption is going to last. After all, the condition that Saddam Hussein has given for the resumption of oil are the withdrawal of the Israelis from the occupied territories, similar to what the Americans have asked the Israelis to do.

So in a way, what Iraq is doing here is a real PR coup. And a way for Saddam Hussein to recapture the imagination of his people, and the Arab people in general. So, it's still difficult to know the real impact on the market. But it certainly adds pressure to the present oil crisis.

PHILLIPS: Do you think we're underestimating the damage that Hussein can cause by halting oil exports?

DIWAN: We're not underestimating yet. What we need to see is how long this interruption can last, and how much of that oil will be replaced by other producers in the Middle East and outside. Russia could increase production, Mexico could increase production, Norway could increase production. And of course, all the Persian Gulf producers could do it, if prices start to increase too much.

PHILLIPS: So do you think Saddam Hussein will gain backup from other Arab countries? Or do you think this will be a solo effort?

DIWAN: It's probably a solo effort. But it's a good defensive effort for Saddam Hussein. Politically, it's quite shrewd, actually, because it allows him to capture the imagination of his people, to have the army help him in this effort. After all, the U.S. is trying to unseat him. And if he can become more popular domestically, that could help him.

And more importantly, regionally, that's quite a good defensive move, which in a way, deters the Americans to go after him. Because the Arab regimes will be unwilling, in a way, to confront him after this very popular action.

PHILLIPS: Roger Diwan, I hate to stop it here, but we have to move to the Pentagon briefing. I know we'll continue to follow the story and talk to you again.

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