Saudis to pump 2mn more barrels of oil

Mr Trump who is spending the weekend at his golf property in New Jersey said in a tweet on Saturday that Saudi Arabia’s King Salman bin Abdulaziz Al Saud had agreed to produce more oil. AFP  SAUL LOEB

Mr Trump who is spending the weekend at his golf property in New Jersey said in a tweet on Saturday that Saudi Arabia’s King Salman bin Abdulaziz Al Saud had agreed to produce more oil. AFP SAUL LOEB

Oil production, prices and politics require a delicate balance.

He explained that it was hard to anticipate how the market would integrate with a possible increase in crude oil output from major producers, referring to Saudi Arabia and Russian Federation.

Overall, however, analysts said OPEC's production policy as well as unplanned supply disruptions were now the main price drivers.

United States production has soared 30 per cent in the past two years, to 10.9 million bpd, meaning the world's three biggest oil producers now churn out nearly 11 million bpd each, meeting a third of global oil demand.

Iran will use various methods to prevent a possible reduction in its oil exports after re-imposition of the US sanctions.

"Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & dysfunction in Iran and Venezuela, I am asking that Saudi Arabia increase oil production, maybe up to 2,000,000 barrels, to make up the difference", Trump said in a tweet on Saturday. Prices to (sic) high!

Medics reach boys in Thai cave as rescuers plan next move
He also said the group would likely be taken out one at a time , and they'd be "closely tethered" to a rescue diver on the trip. Could they be dug out? Other teams are still scouring the mountainside in the hope of finding another way into the cave.

The White House has since walked back the claim that Salman agreed to Trump's request.

Norway-based Rystad Energy expects Iranian production to drop by 700,000 bpd by December 2018.

Libya's National Oil Corporation declared "force majeure", or unforeseeable circumstances, as the country's continued struggles with internal conflicts see approximately 850,000 barrels per day after losing control of Zueitina and Hariga ports this week. The move partly reversed the original OPEC+1 deal which came into force in January past year and was created to reduce the global glut in oil.

Craig added that more issues could develop as Washington tightens the sanctions noose on Iran and Venezuela. Analyst expectations were for a draw of 1 million barrels.

While OPEC leader Saudi Arabia will pick up the slack, Morgan Stanley believes oil markets will be undersupplied by around 600,000 in the second half of 2018. "Since Venezuela and Libya failed to produce, OPEC countries chose to increase their output by one million barrels to compensate", Sonatrach's CEO noted, adding: "This is why prices stand at the same level".

"Also, taking a broad range of estimates from IEA, EIA and others, Saudi held spare capacity in the range of 1.3 - 2.1 mb/d when oil production was ~10 mb/d". "We are also working with oil market participants, including producers and consumers, to ensure market stability".

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