Trump Demanded OPEC Reduce Oil Prices "Now!"
OREANDA-NEWS US President Donald Trump has caused turmoil in the market with his harsh statements on Twitter. This time the American leader has criticized and demanded the OPEC to reduce oil prices. The market responded with a slight decline in prices.
"We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices! We will remember. The OPEC monopoly must get prices down now!," — wrote the President of the United States Donald Trump in his Twitter microblog.
Earlier, harsh statements of the President of the United States in social networks have repeatedly caused not less sharp reaction quotes. "It's funny, but just in case the market goes down," analysts say Forex Club. Since the beginning of trading on Thursday, September 20, the cost of a barrel of Brent lost almost 1%, and the decline was correlated with the time of Trump's tweet.
From the point of view of assessing the long-term prospects of the market, the President's words can be considered a recognition of the inability to further increase production in the US. At the same time, Saudi Arabia has repeatedly pointed out that it wants to achieve an increase in investment volumes to the previous levels in order to ensure long-term sustainability of supplies, says the leading analyst of "OTKRITIE Broker" Artem Lavrishchev.
"Of course, other producers can increase supplies, but global reserve capacity is also limited, and US policy suggests that Iran should stop oil exports in the near future. Therefore, the prospects for the failure of quotations on Trump's tweets are very weak, " the expert believes.
"Trump's position on oil prices has long been known, so we do not expect a strong reaction of quotations. In the course of the day, however, there is slight negative and increased volatility," warns the analyst of "ALOR Broker" Catherine Konyukhov. Now players are more interested in the upcoming meeting of OPEC and its partners, which will take place this weekend, and which will discuss the possible increase in production, the expert notes.
"It is possible that Trump wants a little "knock down" with quotes that are at multi-year highs. In the event that OPEC does not report a significant increase in production, the market may react with an increase in prices above $80 per barrel of Brent. This will be undesirable for America, because the rise in oil prices causes a rise in the price of gasoline," the expert concludes.