Lower oil prices now

Cornelia Mascio
Сентября 23, 2018

"We will remember. The OPEC monopoly must get prices down now!" he tweeted ahead of an OPEC meeting to discuss production on Sunday.

Futures prices for WTI crude, the USA benchmark, dipped slightly following the tweet and were lower by 0.2% on the day.

But on Tuesday Bloomberg cited unnamed Saudi sources as saying the kingdom was comfortable with oil above $80, at least for the short term, helping to push prices higher.

Reuters reported on Sept 5 that Saudi Arabia wanted oil to stay between US$70 and US$80 to keep a balance between maximising revenue and keeping a lid on prices until U.S. congressional elections. At the same time, Iran's traditional ally within OPEC - Venezuela - is struggling to stave off economic collapse.

But DeHaan predicted that could change after OPEC meets later this year.

US sanctions were imposed by Trump in response to Iran's nuclear programme.

"There's really very little amount of spare capacity among OPEC members, and USA producers are already limited by pipeline capacity, especially in West Texas", said Patrick DeHaan, head of petroleum analysis at GasBuddy.

Zanganeh said he won't be attending the Algerian JMMC meeting, which is to occur just days before the two-year anniversary of OPEC's decision to pare production and curb a glut. After 18 months of fairly harmonious supply restraint, some OPEC members were hastily reopening the taps, while others howled in protest from the sidelines.

It is unclear how easily other producers, such as Saudi Arabia, Iraq and Russian Federation, can compensate for lost supply. "It allows us to have a robust production community in the U.S. It's allowing us to be the world's largest producer at this point", he said.

Iran's crude production dropped by 150,000 barrels a day to 3.58 million a day in August, OPEC's research department said earlier this month in a report.

BNP Paribas oil strategist Harry Tchilinguirian told the Reuters Global Oil Forum: "Eighty-dollar-per-barrel Brent is a psychological level, and unsurprisingly, as we approach it, it gets sold into as some market participants take profit".

According to EIA, U.S. total products supplied over the last four-week period averaged 21.38 million barrels per day, up 4.9 percent from the same period a year ago.

Trump seemed to threaten the withdrawal of USA military resources from the Middle East if OPEC members in the region didn't work to lower prices.

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