“Looks like OPEC is at it again,” he wrote. “With record amounts of oil all over the place, including the fully loaded ships at sea, Oil prices are artificially Very High! No good and will not be accepted!”
With this tweet, US President Donald Trump shifted his focus, even if momentarily, on the issue of the price of oil and the way OPEC controls it. Analysts believe that this tweet was referring to OPEC’s production level agreement with Russia and other producers put in place last year and set to expire at the end of 2018.
Oil prices hit a three-year high above $69 a barrel this week. The international benchmark, Brent crude, was above $73 on Friday after also hitting its highest level since November 2014 this week.
Earlier this week there were reports that Saudi Arabia, the key member of the cartel, wants oil at $80 to $100 a barrel in order to boost the eventual initial public offering of its state oil company, Saudi Aramco.
When asked to comment on Trump’s tweet, Saudi Energy Minister Khalid al-Falih told CNBC, “Markets should determine price.” Saudi Arabia also warned oil traders on Friday that a dramatic upswing in crude futures was little reason to become complacent.”We have to be patient. We shouldn’t jump the gun, we shouldn’t be complacent and listen to some of the noise such as ‘mission accomplished’. I think we still have work ahead of us.”
OPEC, Russia and several other allied producers have spearheaded an ongoing effort to try to clear a global supply overhang and prop up prices. The agreement, which came into effect in January 2017, has already been extended through until the end of this year — with producers scheduled to meet in June to review policy.