Oil minister reiterates Trump to blame for rising crude prices

Iran’s oil minister reiterated on Tuesday that US President Donald Trump was responsible for rising oil prices, and warned that the only way to bring balance to the market was to suspend sanctions on Tehran.

The United States aims to reduce Tehran’s oil revenues to zero in an effort to force Iran’s leadership to change its behavior in the region. US officials have said new sanctions will be imposed on Iran’s oil sector from November 4, Reuters reported.

Bijan Namdar Zanganeh said on state television that the Organization of the Petroleum Exporting Countries lacked the capacity to produce more oil to make up for the drop in Iranian sales.

“If Trump wants to bring stability to the oil market, he should suspend sanctions on Tehran,” Zanganeh added.

Oil prices have extended a rally this year on expectations the sanctions on Iran will test OPEC’S ability to replace the shortfall, despite a June agreement among the group to pump more after pressure from Trump.

Brent crude lost 37 cents to reach $84.61 per barrel by 1200 GMT on Tuesday after reaching a four-year high of $85.45 in the previous session.

“China and Europe will be severely damaged by the US sanctions against Iran,” Zanganeh said.

Goldman Sachs Group Inc. said on Tuesday that there’s a risk oil will hold above $80 a barrel toward the end of the year, striking a slightly more bullish tone than it did a week ago, as Iran’s exports plunge and producers pull back from hedging.

Oil futures have gained recently, driven by “one-way financial flow from both consumers and investors”, analysts including Jeff Currie wrote in a report.

“Without producer selling, the two-year forward oil price has rallied to $75.50 a barrel, as consumers and investors hedge oil price risks associated with Iranian sanctions.”