x

Abu Dhabi, UAESaturday 20 October 2018

Trump tweet says Saudi Arabia agrees to raise output by up to 2 million bpd

Post comes after major oil producers outside Opec met ministers from the group last Saturday and endorsed a nominal output increase of 1 million bpd

US President Donald Trump In a tweet, Mr Trump says Saudi Arabia has agreed to up output by up to 2 million barrels a day. SAul Loeb/AFP
US President Donald Trump In a tweet, Mr Trump says Saudi Arabia has agreed to up output by up to 2 million barrels a day. SAul Loeb/AFP

The US President Donald Trump on Saturday posted a tweet saying Saudi Arabia agreed to boost oil production by up to 2 million barrels per day, twice the nominal amount Opec and non-Opec allies signed off on at last week's meeting in Vienna.

"Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & disfunction [sic] in Iran and Venezuela, I am asking that Saudi Arabia increase oil production, maybe up to 2,000,000 barrels, to make up the difference...Prices to high! He has agreed!," Mr Trump tweeted.

The Saudi Press Agency confirmed that Mr Trump had called King Salman bin Abdulaziz, Ruler of Saudi Arabia and the Custodian of the Two Holy Mosques. It said that their discussion included efforts "to preserve the stability of the oil market" and "of the producing countries to cover any possible shortage in supplies". It did not address Mr Trump's claim.

Separately, Kuwait will raise oil output by 85,000 bpd starting on Sunday, Energy Minister Bakhit Al Rashidi told a local newspaper on Saturday.

"Kuwait will raise its oil production from tomorrow to 2.785 million barrels, a daily increase of 85,000 compared to May, based on last week's production cut agreement," Mr Al Rashidi told Arabic-language daily Al-Rai.

Mr Trump's tweet came after major oil producers outside Opec - including Mexico and Kazakhstan - met ministers from the group in Vienna last Saturday and endorsed a nominal output increase of 1 million bpd, said Carlos Perez, Ecuador’s Minister of Hydrocarbons.

Saudi Arabia currently produces10.8 million bpd, according to Reuters.

Following the veinna meeting, Angolan Oil Minister Diamantino Azevedo said: "We have agreed."

_______________

Read more:

UAE Energy Minister Al Mazrouei says unstable oil prices do no one any good

An Opec+ output increase could drag down oil prices by $3 to $5 per barrel, says MUFG

_______________

The increase was described as “nominal” by Saudi Energy Minister Khalid Al Falih.

In real terms, that would add 600,000 to 700,000 bpd of crude to the market over about six months, said Oman’s Oil Minister Mohammed Al Rumhy, according to Bloomberg.

Last week's deal, after a third day of talks, was a win for Saudi Arabia and Russia, which hold the most spare capacity and were the first members to suggest an increase. They now have the flexibility to respond to disruptions and moderate prices at a time when US sanctions on Iran and Venezuela threaten to throw the oil market into turmoil.

Earlier that day, Suhail Al Mazrouei, Minister of Energy and Industry and President of the Opec Conference, said fluctuations in oil prices do not serve producers or consumers.

"Our goal is to rebalance the world oil market by striking a balance between demand and supply," he said, according to state news agency, Wam.

Saudi Arabia plans to pump up to 11 million bpd in July, and Russia has said it could increase output by more than 200,000 bpd, Reuters said on Saturday.

Oil prices hit $80 a barrel this year for the first time since 2014, prompting consumers like the United States to raise concerns.