Published: Wed, June 13, 2018
Economy | By

Trump accuses OPEC of driving up oil prices

Trump accuses OPEC of driving up oil prices

Oil slipped after Russian Federation was said to propose that OPEC and other producers in a global alliance reverse the supply cuts they've been making since early a year ago.

"The demand metrics here are incredible for crude oil and gasoline", said John Kilduff, a partner at Again Capital in NY.

Even if the supply gap, triggered by the return of USA sanctions on Iran and a major political crisis in Venezuela, is plugged, the oil market will likely remain vulnerable to disruption next year, the IEA warned.

Since early 2017, OPEC and other oil-producing countries have agreed to reduce supply in a bid to bolster oil prices.

Brent crude, the global oil benchmark, was down 0.36% at $75.61 a barrel on London's Intercontinental Exchange.

Oil prices dropped on Wednesday as a result of increased supplies in the U.S.

In its closely watched Monthly Oil Market Report published today, OPEC revised up its non-OPEC supply growth estimate by 130,000 bpd compared to last month's report, and now expects non-OPEC supply growth of 1.86 million bpd in 2018 compared to 2017. "Put the exports of crude on top of that, and it's just a really bullish report".


With output in Russian Federation rising back above 11 million bpd in June and Saudi production climbing back above 10 million bpd, supplies from the top three producers are increasing.

OPEC and other producers will meet on June 22-23 in Vienna to discuss future production.

But the Paris-based IEA, echoing statements from oil producers as well as analyst comment in recent weeks, said there may be a change to the so-called Vienna agreement.

Longer term, the market could tighten as demand increases if OPEC fails to cover supply shortfalls, the International Energy Agency said on Wednesday.

In the letter, the senators said a run-up in oil prices is "effectively a tax on every American family's discretionary budget" since the price of oil directly affects the price of gasoline.

"We have looked at a scenario, not a forecast, showing that by the end of next year output from these two countries (Venezuela and Iran) could be 1.5 mb/d (million barrels per day) lower than it is today", it said in a report.

Like this: