Saudi threatens to retaliate against any USA sanctions over Khashoggi disappearance

The Kingdom "is committed to its principles, rules and traditions and is in compliance with worldwide laws and conventions", he added according to the official Saudi Press Agency.

"The Kingdom also affirms that if it receives any action, it will respond with greater action, and that the Kingdom's economy has an influential and vital role in the global economy..." the source added without elaborating.

Almost two weeks since Jamal Khashoggi vanished in Istanbul, the shadow of the Saudi journalist's disappearance continues to loom ever larger.

Turkish authorities claim to have evidence that Khashoggi, a United States resident and columnist for the Washington Post, was murdered inside the consulate - an accusation the kingdom strenuously denies.

As for the Saudi-Turkey investigation into Khashoggi, I expect it to go along national lines.

Sanders suggested that cutting ties to the war in Yemen would be among the strongest responses the US could undertake.

Khosrowshahi's decision not to go "unless a substantially different set of facts emerges" could put him and Uber in an awkward spot because Saudi Arabia's Public Investment Fund owns about a 5.6 per cent stake in the privately held ride-hailing app.

Saudi Arabia insists Khashoggi left the building safely and dismissed accusations that authorities had ordered his murder by a hit squad as "lies and baseless allegations".

"They demanded for what they called a "credible investigation" to establish the truth about what happened to Jamal Khashoggi and to identify those responsible for his disappearance". Western banks have also hoped to help the kingdom privatize its giant oil company, Saudi Aramco, although the country's plans for an initial public offering appear to have stalled.

Meanwhile, Saudi King Salman spoke by telephone with Turkish President Recep Tayyip Erdogan about Khashoggi.

But Trump, who has frequently boasted about his business ties with the kingdom, suggested during the interview that ending US arms sales to Saudi Arabia would not be an option, saying, "I don't want to hurt jobs".

The Saudis deny killing Mr Khashoggi. The journalist had given his phones to his fiancée before entering the Saudi Consulate in Istanbul on October 2.

British entrepreneur Sir Richard Branson has halted talks over a slated US$1bn (NZ$1.5b) Saudi investment in Virgin's space firms.

That sent the Saudi share index down as much as 7 percent on Sunday, and prompted a threat of Saudi retaliation for any punitive measures.

Meanwhile, there is concern Khashoggi's disappearance could add to a sense that Saudi policy has become more unpredictable under Crown Prince Mohammed bin Salman, who is pushing social reforms to modernise the kingdom but has also presided over a rise in tensions between Riyadh and several other countries.

"We're going to get to the bottom of it and there will be severe punishment", he told CBS News.

"No matter how important they might be to our Iranian strategy, our ability to be a voice for human rights.is undermined and compromised if we are not willing to confront something as atrocious as what's allegedly happened here", Rubio said.

  • Wendy Palmer