13-11-2018 03:00 PM
Oil prices dropped 1% on Tuesday after reports came in that U.S. President Donald Trump asked the Organization of the Petroleum Exporting Countries (OPEC) not to slash production to drive up crude oil prices.
Trump posted in Twitter on Monday - "Hopefully, Saudi Arabia and OPEC will not be cutting oil production. Oil prices should be much lower based on supply."His remarks came after Saudi energy minister Khalid al-Falih pronounced plans on Sunday to slash oil production from December and recommended that other members of OPEC and their non-OPEC allies led by Russia could follow suit.
According to sources - The kingdom would slash oil supply by 0.5 million barrels per day (bpd) in December due to lower seasonal demand. The slash represents a fall in global oil supply of about 0.5%. Al-Falih also recommended that there might be a need for OPEC and non-OPEC members to trim supply back by 1 million bpd from October levels.
Oil prices touched nearly four-year highs in October as the market firmed for likely shortages at the forefront of the restitution of sanctions against Iran, the third-largest producer OPEC on Nov. 4.
The sanctions, on the other hand, are doubtful to cut as much oil out of the market as originallylikely as Washington has approved exemptions to Iran's biggest buyers, which will permit them to continue buying inadequate amounts of crude for at least another six months.