Trump, Iran spar over oil prices ahead of OPEC meeting

WASHINGTON/LONDON: US President Donald Trump and Iran exchanged sharp words over oil prices, with Trump blaming OPEC for high oil prices and Tehran accusing him of stoking volatility after he withdrew last month from a global nuclear arms deal with Iran.

Trump sparked the latest backand-forth when he renewed his attack on OPEC in a tweet that said oil prices are too high and that the cartel was “at it again.”

Oil prices have risen by around 60 per cent over the last year after the Organization of the Petroleum Exporting Countries and some non-OPEC producers, including Russia, started reducing supplies in 2017.

The cartel meets June 22-23 in Vienna, and producers are seen as likely to raise production, perhaps before the limits are due to sunset at year-end.

Iran’s OPEC governor, Hossein Kazempour Ardebili, fired back quickly at Trump’s words.

“You cannot place sanctions on two OPEC founder members and still blame OPEC for oil price volatility,” he said in a statement to Reuters, referring to his country and Venezuela. “This is business, Mr. President - we thought you knew it.”

The oil supply deal is set to continue through the end of 2018, but plans for its continuation were unclear.

The calculus changed after Trump announced in May that the United States was pulling out of the 2015 deal that restricted Iran’s nuclear program in exchange for the removal of sanctions.

The US move has put pressure on European and Asian clients to stop importing Iranian oil or doing business with the country.

Saudi Arabia, Iran’s rival and the largest producer in OPEC, and Russia, the world’s largest producer and a party to the deal, have already increased supply.

Saudi Arabia supported Trump’s decision to exit the Iran nuclear agreement.

“I think the Trump tweet makes the Saudi’s job of getting compromise at the OPEC meeting tougher,” said Joe McMonigle, senior energy policy analyst at Hedgeye Potomac Research in Washington.