President Donald Trump blasted OPEC in a tweet Thursday morning, saying the Middle East wouldn't be safe without USA military protection and yet, countries there continue to keep prices high.
US President Trump had some choice of words for the Organization of the Petroleum Exporting Countries (OPEC) members Thursday (September 20) morning ahead of the group's meeting in Algeria on Sunday (September 23).
U.S. West Texas Intermediate crude ended Thursday's session down 38 cents, at $70.80/Bbl, after rising almost 2% the previous session. For East Coast refineries, the price difference between the worldwide benchmark Brent and the domestic benchmark West Texas Intermediate (WTI) helps determine when the additional costs of acquiring and transporting domestic crude oil to the East Coast can be overcome.More news: US Sanctions Russian Intelligence, Military Officials
U.S. crude futures were up $1.08 at $70.93 a barrel by 11:15 a.m. [1515 GMT], after the U.S. Energy Information Administration said crude and gasoline stockpiles fell last week. This comes after the June 22 agreement between the OPEC (Organization of the Petroleum Exporting Countries) and Russian Federation for increasing the production and reducing the prices.
OPEC leaders are unlikely to heed the president's warnings, however a source told Reuters, "Saudi Arabia is anxious that any sanctions-related spike in oil prices will trigger fresh criticism from Trump, but it also faces doubts over its ability to compensate for a drop in Iranian supply". "We will remember", he tweeted.
USA sanctions on Iran are set to hit Tehran's oil sales on November 5, with S&P Global Platts Analytics forecasting that up to 1.4 million b/d of Iranian supplies will be shut-in. But it is unclear how easily other producers can compensate for any lost supply.More news: Celia Barquín: Iowa State teams to pay tribute to golfer
Trump has imposed sanctions in response to Iran's nuclear program that are to go into full effect on November 4. The oil prices were increased to its highest level until this year.
Brent has been trading below the psychologically important $80 level for the last week but could now move higher, Reuters markets analyst Wang Tao said. "But this is likely going to break very soon", said SEB Markets chief commodities analyst Bjarne Schieldrop.
Consultancy JBC Energy said in a note "The market may have taken this as a sign that supplies may not go up much in response to further declines in Iranian crude exports".More news: WEF: Machines will do more tasks than humans by 2025