- Oil Prices Jump to 4 Year High on Trump/OPEC Comments
Global oil prices rose to a record high on Monday following the refusal of OPEC to announce an immediate increase in production despite President Trump calls for an increase in global supply.
Brent crude, against which Nigerian crude is measured, climbed 2.1 percent to $80.94 per barrel on Monday. The highest since November 2014.
“This is the oil market’s response to the OPEC+ group’s refusal to step up its oil production,” said Carsten Fritsch, commodities analyst at Commerzbank in Frankfurt.
Last week, President Trump had said OPEC “must get prices down now”.
However, Saudi Arabia, OPEC biggest producer, and key ally outside the group, Russia, on Sunday said the cartel will not increase production unless there is demand for it.
“I do not influence prices,” Saudi Energy Minister Khalid al-Falih said during OPEC and non-OPEC meeting in Algiers. The meeting ends without a formal recommendation for additional supply.
The refusal of the cartel to yield to President Trump’s call for additional oil supplies boosted prices.
Bijan Zanganeh, Iranian Oil Minister on Monday said OPEC did not respond positively to Trump’s demands.
Certain experts believe the refusal of the organization to raise production will create supply gaps in near-term.
“It is now increasingly evident, that in the face of producers reluctant to raise output, the market will be confronted with supply gaps in the next 3-6 months that it will need to resolve through higher oil prices,” BNP Paribas oil strategist Harry Tchilinguirian told Reuters Global Oil Forum.