Saudi Arabia Moves To Hike Oil Output Amid Iran Tension

Saudi Arabia, the largest OPEC oil producer, is moving to increase its crude production and exports to the U.S. as oil prices surge and tensions around Iran threaten to cut supply further.

The Financial Times reported that the Saudi government said Monday it was working to return oil prices to fair levels, targeting $100 per barrel.

Iran, OPEC's second-largest producer, is facing EU sanctions in July. Last week, the U.S. requested the Saudis consider boosting their oil production in response to a possible shortfall.

The Saudis have indicated support for greater production, but are seeking to remain detached from the brewing international tension.

Saudi Arabia already increased oil production in January to the second-highest level in more than 30 years, with 9.87 million barrels of crude per day, according to official data released Tuesday.

The nation's oil production rose 0.6 percent compared to the previous month and oil shipments rose to 7.51 million barrels per day from 7.36 million in December, the Saudi government reported to the Joint Organisations Data Initiative.

Saudi Arabia's oil inventory rose 5.9 percent to 254.6 million barrels of crude in January, up from 240.6 million in December.

Brent crude oil has risen to $125 per barrel, sending U.S. gas prices over $4 per gallon in some areas.