Trump slams OPEC as oil prices trade near $80 a barrel

Galtero Lara
Setiembre 21, 2018

With crude oil prices steadily climbing to $80 a barrel, President Trump on Thursday again slammed OPEC - tweeting that prices keep rising even as the U.S. spends billions to safeguard oil-producing Mideast countries.

The president also suggested it was unfair that OPEC raises prices when, "We protect the countries of the Middle East, they would not be safe for very long without us".

Prices dropped fractionally after the president's attack, with Brent crude falling.77 percent to $78.31 a barrel at 12:45 p.m., according to oilprice.com, which tracks global prices.

The Asian recovery in WTI (oil futures on NYMEX) got sold-off into the $ 70 barrier in the European morning, as markets turned cautious ahead of the weekly U.S. crude stockpiles report due to be published by the Energy Information Administration (EIA) later on Wednesday.

Crude prices have been bolstered by declining Iranian crude exports, as the market prepares for the full imposition of USA economic sanctions on the Islamic Republic's oil industry at the start of November.

But a late June decision by OPEC-de facto led by Saudi Arabia-and Russian Federation to begin ramping up production this summer after more than a year of holding back output helped to put a cap on crude's ascent.

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Trump has imposed sanctions in response to Iran's nuclear program that are to go into full effect on November 4.

However, the downside might remain cushioned amid a broadly softer United States dollar, looming supply risks from USA sanctions on Iran and the recent Saudi Arabian comments.

Under pressure from the US president, the Organization of the Petroleum Exporting Countries, Russia and other allies agreed in June to boost production by 1 million barrels per day, having participated in a supply-cutting deal since 2017. They also don't want oil prices to fall too much'.

The weekend gathering will discuss how to share the previously agreed output increase and examine whether the market needs more oil to offset the loss of Iranian supply as well as a decline in Venezuelan output, the sources said.

Saudi officials believe there is insufficient oil demand so far to justify raising Saudi output much beyond the roughly 400,000 bpd that it has pumped above its 10 million bpd target, OPEC and industry sources told Reuters.

Though Saudi Arabia has never tested such high levels, it has said it pumped 10.7-10.8 million bpd in the past.

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