Expert Commentary

Trump Teases On Oil By Ashraf Laidi
Tue, 03 Jul 2018 11:50:12 GMT
Source: Dukascopy Bank SA
 

Trump has asked a King of Saudi Arabia to increase the Oil production.

On Saturday (30.06.2018), Donald J. Trump tweeted that he has asked Saudi Arabian King Salman to increase the oil production "maybe up to 2,000,000 barrels", and the King has agreed. Such tweet could create the negative changes in the market, if came during the trading hours, but the market was closed, and "it gave the Saudis and White House time to go into damage control."


Donald J. Trump‏ @realDonaldTrump Jun 30 More 

Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & disfunction 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...Prices to high! He has agreed!

"Oil has been on a tremendous run, climbing more than 13% in the past six trading days to reach the best levels in four years, but Donald Trump ensured the bulls weren't sleeping easy on the weekend."

Such ramping is possible for the short period of time, but in long-run it will ache or break The Organization of the Petroleum Exporting alliance. "However that may be a price Saudi Arabia is willing to pay to ensure its alliance with the US against Iran."

"Oil opens the week above $74 (crude) and $78 (brent). Counteracting the Saudi headlines somewhat is the closure of four Libyan oil ports, removing 850K bpd of crude from the market. Dip buyers have been waiting on every small slide in the past week."


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