Oil falls as Trump pressures OPEC

LONDON: Oil fell on Thursday after US President Donald Trump called for OPEC to boost crude production to lower the price of the commodity.
International Brent crude oil futures slid 26 cents to about $67.57, while US West Texas Intermediate (WTI) crude futures were down about 24 cents to $59.17.
“Very important that OPEC increase the flow of Oil. World Markets are fragile, price of Oil getting too high. Thank you!” Trump wrote in a post on Twitter.
Brent crude has risen more than 25 percent this year on the back of moves by OPEC and allies like Russia to cut output, as well as plummeting Venezuelan production. On top of US sanctions, power cuts have crippled Venezuela’s oil industry.
The country’s main oil export port of Jose and four crude upgraders, needed to convert Venezuela’s heavy oil into exportable grades, have been halted since Monday, industry sources said.
US sanctions have also hit Iranian crude exports.
Analysts said that they expected the US in early May to extend some sanction waivers on Iranian oil, but might reduce the number of countries receiving them.
The 180-day exemptions were granted in November to China, India, Greece, Italy, Taiwan, Japan, Turkey and South Korea.
“Enjoy it whilst it lasts. The upcoming six months will bring relatively healthy demand for OPEC oil,” PVM’s Tamas Varga said in a note.
“If the unplanned supply cuts remain in place ... oil prices should edge toward $75/bbl ... in coming months as global inventories will draw.”
Data from the US Energy Information Administration showing a surprise rise in US crude inventories last week also weighed on prices on Thursday.
Oil stocks rose 2.8 million barrels, the report showed, compared with analysts’ expectations for a drop of 1.2 million barrels. Demand concerns on the back of economic jitters linked to the US-Chinese trade war have further capped prices.
In a fresh development, China made unprecedented proposals on a range of issues, including forced technology transfer, as the two sides work to end their protracted dispute
Separately, Russia’s Gazprom Neft does not expect the global deal to cut oil output will last long and does not take it into account in its long-term planning, CEO Alexander Dyukov said on Thursday.
Russia and other non-OPEC producers — an alliance known as OPEC+ — agreed in December to reduce supply by 1.2 million barrels per day (bpd) from Jan. 1 for six months.
Gazprom Neft plans to increase or at least maintain hydrocarbon production at 100 million tons per year after 2020, Dyukov said.
“We set the task of being better than the market and growing faster than the market,” he added.
Gazprom Neft is the oil arm of Russian gas giant Gazprom.