Oil prices fall as Trump urges OPEC to cut prices

Donald Trump

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US President Donald Trump tweeted this week on Wednesday that the Organization of Petroleum Exporting Countries (OPEC) is "driving [fuel] prices high" and asked them to "REDUCE PRICING NOW".

U.S. President Trump continues to bash Saudi Arabia, in particular, and OPEC, in general, to raise production, which he believes will lead to lower prices.

Brent was being pressured by expectations for higher Saudi and Russian Federation production, which impacts Europe and Asia, where Brent is the benchmark, more than markets dominated by U.S. crude prices.

"This must be a two way street", his latest statement read. The bank said that US efforts to block Iran from exporting oil would make it hard for OPEC to meet supply demands, forcing prices to rise.

Iranian OPEC Governor Hossein Kazempour Ardebili claimed Thursday Trump's tweets are putting upward pressure on prices. "Pls stop it, otherwise it will go even higher!"

The US President has lashed out at OPEC in recent weeks.

OPEC's production limits, which were implemented and extended multiple times to help bolster prices, have contributed to oil's rise.

West Texas Intermediate crude for August delivery fell 63 cents to $73.51 a barrel at 11:37 am on the New York Mercantile Exchange.

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"The responsibility of paying unnecessary prices for oil by all consumers of the whole world, especially in USA gas stations, is exclusively upon [Trump's] shoulders and the price of over $100 per barrel is yet to come".

The agreed increase in production is a good political move from Saudi Arabia because it shows that it does not aim to harm the world economy or its customers, only to return to a stabilized oil market.

Healy Baumgardner, a global fossil fuel adviser and the former press secretary for the Energy Department under President George W. Bush, told UPI there are factors beyond Iran that are influencing the price of oil, notably the growing fears of a global trade war.

"The U.S. -China trade dispute is set to intensify as neither side is prepared to back down", said Abhishek Kumar, senior energy analyst at Interfax Energy.

OPEC agreed with Russian Federation and other oil-producing allies last month to raise output from July, with Saudi Arabia pledging a "measurable" supply boost but giving no specific numbers.

"If Trump continues to believe that OPEC are not doing enough, we would not rule out an SPR (Strategic Petroleum Reserve) release from the USA, or possibly even export restrictions on petroleum products", ING said in a note. Trump could also use it as a tool to persuade buyers of Iranian oil to halt their purchases in the run-up to November 4, when US sanctions against the Islamic Republic are due to snap back.

In late morning trading Thursday, the price of the worldwide benchmark Brent grade of crude oil was little changed at $77.85 a barrel. Trump wants lower oil prices while at the same time his administration is trying to zero out 2.5 million barrels per day of Iranian oil exports. The Saudis have increased oil production, following an OPEC meeting last month, but it hasn't been enough to overcome the effects of reduced supplies from other producers.

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