Trump claims Saudi Arabia will boost oil production
US president’s comments come as oil prices edge higher
President Donald Trump said yesterday that he had received assurances from King Salman of Saudi Arabia that the kingdom will increase oil production, “maybe up to 2,000,000 barrels” in response to turmoil in Iran and Venezuela. Saudi Arabia acknowledged the call took place, but mentioned no production targets.
Trump wrote on Twitter that he had asked the king in a phone call to increase oil production “to make up the difference ... Prices to (sic) high! He has agreed!”
A little over an hour later, the state-run Saudi Press Agency acknowledged the call, but offered few details. “During the call, the two leaders stressed the need to make efforts to maintain the stability of oil markets and the growth of the global economy,” the statement said.
It added that there also was an understanding that oil-producing countries would need “to compensate for any potential shortage of supplies.” It did not elaborate.
Oil prices have edged higher as the Trump administration has pushed US allies to end all purchases of oil from Iran. Oil prices also have risen with the ongoing unrest in Venezuela, as well as with fighting in Libya over control of that country’s oil infrastructure.
Global prices
Last week, members of the Organisation of Petroleum Exporting Countries, led by Saudi Arabia, agreed to pump 1 million barrels more crude oil per day, a move that should help contain the recent rise in global energy prices. However, summer months in the US usually lead to increased demand for oil, pushing up the price of gasoline in a midterm election year.
Trump’s comments came yesterday as global financial markets were closed. Brent crude stood at $79.42 a barrel.
Saudi Arabia currently produces some 10 million barrels of crude oil a day. Its all-time record is 10.72 million barrels a day. Trump’s tweet offered no time frame for the additional 2 million barrels — whether that meant per day or per month.
The Trump administration has been counting on Saudi Arabia and other Opec members to supply enough oil to offset the lost Iranian exports and prevent oil prices from rising sharply.
The administration has threatened close allies such as South Korea with sanctions if they don’t cut off Iranian imports by early November. South Korea accounted for 14 per cent of Iran’s oil exports last year, according to the US Energy Department.
China is the largest importer of Iranian oil with 24 per cent, followed by India with 18 per cent. Turkey stood at 9 per cent and Italy at 7 per cent.