Oil Near $74 Amid Trump Tweets, Forecast Drop in US Stockpile

Oil Near $74 Amid Trump Tweets, Forecast Drop in US Stockpile

"REDUCE PRICING NOW!" Trump tweeted on Wednesday, demanding that the Organization of Petroleum Exporting Countries do more to help reduce U.S. gasoline costs.

"The OPEC Monopoly must remember that gas prices are up & they are doing little to help", Trump tweeted on the Fourth of July. His latest was a reminder that the United States defends many OPEC members for "very little" money. "This must be a two way street, REDUCE PRICING NOW!"

OPEC members agreed June 23 to increase crude oil output by pumping 1 million barrels more daily, but it is still unclear how much of the oil produced would ease off prices in a period-the northern hemisphere's summer-generally associated with high oil demand.

Brent crude oil edged up Wednesday after a second consecutive drop in USA crude inventories, driven by an outage at the Syncrude Canada oil sands facility, which usually supplies the U.S.

Hossein Kazempour Ardebili, Iran's ambassador to the Organization of the Petroleum Exporting Countries (OPEC), was quoted by media as saying that the world - and specifically American consumers - would eventually consider Trump blameworthy for runaway oil prices in global markets. Any time there's talk of increased production or even a suggestion, prices tend to go down.

"We're continuing to see - and I expect the trend will continue - lower inventories in Cushing in July, resulting in a very tight light sweet crude market", said Andrew Lipow, president of Lipow Associates. Brent crude was trading at 78.05 a barrel at 4pm UAE time on Tuesday.

Venezuelan production fell to 1.36 million bpd by June, compared to just under 2.5 million bpd at the start of previous year, amid a structural underinvestment in the country.

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US West Texas Intermediate (WTI) crude futures were down 16 cents, or 0.2 percent, at $73.98 per barrel. "Under these circumstances it is justified to argue for higher prices when production increases are announced", PVM Oil Associates strategist Tamas Varga said, CNBC reported. International Brent crude slipped below $77 on world markets.

Despite the key member Saudi Arabia reaffirming that the cartel and its allies will boost output, Goldman Sachs warned that oil is likely to lead a new rally as the market faces significant supply risks from Venezuela to Iran.

(So it's unclear how much effect Trump's morning tweet will have anyway.) On top of all that, Trump's decision to sanction Iran's supplies, and his generally hardline stance against the country, add to market worries. "Perhaps one of the USA president's advisors should explain this to him", the German financial institution added.

Saudi Arabia also said it would reduce the official selling price of its August barrels.

Prices have risen as a result of Washington's plans to reimpose sanctions against Iran, OPEC's No. 3 producer, analysts said.

OPEC members in coordination with Russian Federation just reached an agreement to pump an additional 1 million barrels a day onto world markets.

The U.S. government has demanded that all countries stop buying Iran's oil from November.

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