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    Add another factor to the uncertainty in the crude oil market? OPEC points to him

    2019-03-14 12:51:34

    Gold headline

    During the CERAWeek Energy Industry Conference in Houston this week, OPEC Secretary General said that Trump's tweets about oil prices have become one of the new uncertainties facing oil-producing countries and the wider market.

    Mohammed Barkindo said: "The president will not give notice until the tweet is published."

    In the past year, oil prices have been one of the key “themes” of Trump's tweets. He has been calling on OPEC to allow more oil to enter the market to curb rising oil prices, and every time he complains, it can trigger turmoil in the crude oil market.

    Just last month, Trump, the "strongest oil analyst," again published a tweet complaining that oil prices were too high, and oil prices fell by 3%. He said in the tweet: "The price of oil has risen too high. OPEC, please relax."

    It's worth noting that Trump had only intervened when the price of oil rose to the mid-to-high range of $70-80, but when Trump sent a tweet recently, the price of oil was well below $70.

    Reuters market analyst John Kemp said that Trump's willingness to endure the rise in oil prices seems to be lowering, and the level of oil prices when he intervened in Twitter has gradually declined.

    OPEC is struggling to cope with the growing challenges of the global crude oil market, from the turmoil in Libya, to US sanctions against Iran and Venezuela, and to the accelerated growth of US production, which are challenges facing the crude oil market.

    As OPEC strives to boost oil prices through production cuts, US oil supplies have increased dramatically. At present, the average daily output of US crude oil has reached more than 12 million barrels, exceeding Saudi Arabia and Russia.

    After experiencing a sharp fall in oil prices at the end of last year, OPEC+ reached an agreement in December to reduce total daily production by 1.2 million barrels in the first six months of 2019. Of these, 800,000 barrels per day will come from OPEC members, while Russia and its allies will cut production by 400,000 barrels per day.

    At present, Brent crude oil and WTI crude oil have risen to the highest level this year. Among them, Brent crude oil has approached 68 US dollars, WTI crude oil broke through 58 US dollars.

    Barkindo said that as the world's largest oil producer, Trump's focus on the energy and oil markets is not just a temporary interest.

    At the same time, OPEC is also facing a new threat, and the legislation that gives the US government the power to sue OPEC members in the name of manipulating oil prices is moving to Congress.

    The gold headline mentioned in the previous article that the US Congress is currently discussing the NOPEC bill. If the NOPEC bill becomes law, it will expose the national oil companies of OPEC members to antitrust lawsuits.

    However, it seems that the NOPEC bill is not likely to be passed. But once passed, it means that Trump has a stronger weapon in the face of OPEC.

    Barkindo said he hopes the United States will "keep a rational" to stop this action, as it could adversely affect OPEC and the wider oil industry.

    “The stability of the market is not only beneficial to OPEC and non-OPEC countries, but also to the United States that produces shale oil.”

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    Editor in charge: Lu Shan RF10057

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