Donald Trump and Iran exchanged sharp words over oil prices on Wednesday, with Tehran accusing the US president of contributing to volatile prices after he withdraw from a global nuclear arms deal last month.
Prices were pulled down by another rise in USA oil production C-OUT-T-EIA, which hit a weekly record of 10.9 million barrels per day (bpd) last week, according to the Energy Information Administration (EIA) on Wednesday. They have shown discipline in limiting production since the start of previous year, helping push up the benchmark price of global crude.
The price surge is taking a toll on heavy-energy users in the United States, where the producer-price index rose by 0.5pc in May from a month earlier, according to the latest data from the USA labor department. That move took USA crude from about $50 a barrel in late 2016 to more than $70 in 2018.
US President Donald Trump yesterday blamed OPEC for excessive oil prices.More news: The United States, Mexico And Canada Will Host The 2026 World Cup
The potential collaboration between the two major oil buyers would present another challenge for OPEC, which is facing competition for market share in Asia from the flood of crude pumped in the Gulf of Mexico and shale fields of Texas.
"Statements by several parties suggest that action in terms of higher supply could be on the way", said the IEA, which represents the U.S. and other oil-consuming nations. The meeting is expected to be one of the most contentious summits in recent years, as Iran, Venezuela, and Iraq are against boosting production and are criticizing Saudi Arabia for not having briefed them prior to commenting that production may be raised.
U.S. oil production has more than doubled in the past decade, including a 19 percent increase since OPEC's limits took effect in January 2017, according to the U.S. Energy Information Administration. The kingdom reported that it increased production in May to about 10 million barrels a day. "Not good!" the president said. The House Judiciary Committee approved a bill Wednesday to subject OPEC to US antitrust law by removing state immunity shields. Bob Goodlatte, R-Va., said shielding a cartel like OPEC "makes a mockery of USA antitrust law, threatens the American economy and has the potential to harm our national security".
The talks come within less than two months of oil minister Dharmendra Pradhan proposing an alliance between Indian and Chinese staterun oil companies for a greater say in the market.More news: Ministers win key Brexit bill vote after concession
Dangers included the possibility of higher prices amid trade disruptions prompted by the tariffs war unleashed by the U.S. against China, but which has also sucked in the EU, Canada and Mexico.
Oil pumpjacks are seen in Lagunillas, Venezuela May 24, 2018.
Democrats are trying to blame Trump for higher gasoline prices, sensing the issue will resonate with voters in the November midterm elections that will determine control of the House and Senate.
Charles Schumer, the leader of Senate Democrats, recently linked $3-plus gasoline to Trump's decision to revive sanctions on Iran.More news: Major Crowd Fight Takes The Shine Off Tyson Fury Return
- Form Jonny Bairstow ready for different challenge posed by Australia
- Added Sugar Consumption In Toddlers Is On The Rise In The US
- Seen through 2018 lens, 'NAFTA World Cup' in 2026 is, well, awkward
- 120 countries blame Israel for 'excessive' force against Palestinians
- Man Utd transfer bombshell: Anthony Martial demands exit as agent confirms plans
- South Africa v England - story of the match
- Star Wars SHOCK: George Lucas ‘Fans would have HATED my sequel trilogy’
- Norwegian lawmakers nominate Trump for Nobel Peace Prize
- NASA rover falls silent as very big dust storm envelops Mars
- U.S., Canada & Mexico to host 2026 World Cup