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OPEC and Russia shrug off Trump’s tweet tirade on oil prices

OPEC and Russia shrug off Trump’s tweet tirade on oil prices

OPEC leader Saudi Arabia and its biggest oil producer ally outside the group, Russia, have pushed back against attempts by US President Donald Trump to reduce the price of oil, announcing on Sunday that there would be no additional price decrease in the near term, Reuters reported.

The Saudi Arabian energy minister Khalid al-Falih told reporters at a gathering of energy ministers both from OPEC and non-OPEC countries in Algiers on Sunday, “I do not influence prices.” The meeting finished with a formal recommendation that prices would not be reduced.

The announcement followed comments from President Trump on Twitter that the worlds biggest oil produces should cut their prices, as the price of benchmark Brent oil hit $80 a barrel.

“We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices! We will remember. The OPEC monopoly must get prices down now!” Trump said in a Tweet on Thursday, ahead of the meeting in Algiers.

The rally in prices is believed to be mainly a result of reduced oil output after fresh sanctions placed on OPEC producer Iran by the US. American sanctions on Venezuela and the crisis in the country has also hit production.

Falih said Saudi Arabia has spare capacity to boost output but that this action was not necessary for now, and might not be needed next year because OPEC projects there will be a marked rise in oil production from non-OPEC countries which could outpace global demand.

The minister said that Saudi Arabia could raise output by 1.5 million barrels a day if necessary.

“Given the numbers we saw today, that [an output increase in 2019] is highly unlikely unless we have surprises on the supply and demand,” Falih said, Reuters reported. “The markets are adequately supplied. I don’t know of any refiner in the world who is looking for oil and is not able to get it.”

The higher oil prices could cause problems for Trump in the lead up to the midterm congressional elections in November. But the third largest OPEC producer, Iran, has said Trump is to blame for the oil price rise through his sanctions on the country, and Iran has accused Saudi-Arabia of deferring to US pressure.