Oil prices fell to nearly $74 on Thursday after U.S. President Donald Trump tweeted demanding that OPEC cut prices for crude, Bloomberg reports.
Futures in New York were 0.3 percent higher following the U.S. Independence Day holiday, remaining near the highest since 2014.
Trump criticized OPEC on Twitter again for failing to lower prices for consumers. Although Saudi Arabia has pledged the organization will boost supplies, Goldman Sachs Group Inc. said that losses in some members — notably Venezuela and Iran — will lead to a new rally.
Oil has rallied as the Organization of Petroleum Exporting Countries’ plan to increase output has been overshadowed by supply disruptions in Libya, Canada and Venezuela. While Saudi Arabia is facing mounting pressure from Trump to do more, America’s oil sanctions on Iran and trade frictions with China are adding to uncertainties with planned U.S. tariffs on Chinese goods set to start Friday.
“Further declines in U.S. crude oil inventories and the significant outage in Libyan oil supply are helping to keep a floor under the market,” said Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas SA in London. “But there is no conviction about the next direction for prices yet. People are firming up their numbers of how much Iranian oil exports will be lost, and how much OPEC will increase.”
West Texas Intermediate crude for August delivery traded at $74.35 a barrel on the New York Mercantile Exchange, up 21 cents, at 10:43 a.m. in London. The contract added 20 cents on Tuesday, and there was no settlement Wednesday due to the U.S. holiday.
Brent for September settlement lost 20 cents, or 0.2 percent, to $78.04 a barrel on the London-based ICE Futures Europe exchange, after gaining 48 cents on Wednesday. The global benchmark traded at a $6.11 premium to WTI for the same month.
Yuan-denominated futures were little changed at 497.6 yuan a barrel on the Shanghai International Energy Exchange, after losing 1.4 percent Wednesday.
U.S. crude inventories probably declined by 5 million barrels last week, according to a Bloomberg survey. Data from the Energy Information Administration is due Thursday, published a day later than normal because of the Independence Day break. The American Petroleum Institute, an industry body, was said to report that stockpiles fell by 4.51 million barrels.
President Trump wrote in the tweet that the “OPEC Monopoly must remember that gas prices are up & they are doing little to help,” and that America defends many OPEC members for “very little” money. “This must be a two way street. REDUCE PRICING NOW!”
In response, Iranian oil official Hossein Kazempour Ardebili said that Trump should stop tweeting because his statements have pushed oil prices up by about $10 a barrel, according to Oil Ministry news service, Shana.
“As far as the geopolitical posturing via twitter or official statements, I think the market is taking them in stride for now,” Tchilinguirian said.