Trump urges OPEC not to cut production ahead of Vienna talks

Trump urges OPEC not to cut production ahead of Vienna talks
US President Donald Trump is an ardent climate change sceptic.
Published: 6 December 2018 - 5:30 a.m.
By: Carla Sertin

US President Donald Trump urged OPEC to avoid production cuts ahead of its meeting in Vienna today. Oil prices are a key point for US voters, and Trump wants to keep them low.

When oil prices hit a four-year high of $86 per barrel of Brent crude in early October, Trump blamed Saudi Arabia and OPEC, implying they were making a strategic move to raise oil prices. As the oil price fell 30% since early October, he called the drop a "tax cut" and thanked Saudi Arabia, pushed for even lower prices.

OPEC is expected to suggest production cuts of around 1mn barrels per day (bpd) for 2019, despite Qatar's recent announcement that it would exit the organisation as of January 1, 2019. Analysts have noted that the country's exit from OPEC would not have a significant impact on its plans.

Although Trump would like to see lower oil prices, analysts have noted that low prices could ultimately hurt the US, which has ramped up its production; shale production in the Permian region faced bottlenecks, with logistics, transportation and workforce issues, and requires further investment from operators. A surge of supply from US producers was one factor in the recent drop in oil prices, as well as the country's issuance of eight waivers surrounding sanctions against Iran.

 


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