Trump talks oil in call with Saudi king

Andrew Cummings
October 3, 2018

Oil traders prepared for the possibility of $100 a barrel before year-end after Brent crude hovered close to its highest since November 2014 on Monday.

Brent futures were up $1.28 a barrel at $84.01 by 11:38 a.m. EDT (1538 GMT), the highest since November, 2014. WTI has risen around 18% since mid-August.

Worldwide benchmark Brent crude futures for December delivery dropped 0.6 percent to $84.43 per barrel, hovering just below its highest since November 2014 of $85.45-peak hit on Monday.

Futures rose as much as 0.4 percent in NY after closing Monday at the highest since November 2014.


India imported 220 million tonnes (mt) of crude in the year to March 2018, 3 per cent more than the previous year.

The sanction comes into effect on November 4, 2018, and it is created to cut crude exports from the third-biggest producer in the Organization of the Petroleum Exporting Countries (OPEC).

OPEC and traders fundamentally disagreed for nearly the entire run up in oil prices in 2007/8, with OPEC insisting the market was well-supplied while traders continued to bid up prices amid concerns about shortages. It should be noted that the call to reduce oil prices comes from a major exporter, as United States oil production is booming at record levels with exports surpassing most OECD countries.

"The new accord signed by the U.S., Mexico and Canada raises optimism that we may see increased crude flows in the region", Kim at Samsung said.


Crude prices will likely reach $100 per barrel for the first time since 2014, and OPEC has no leverage to prevent such a scenario, an analyst has warned.

Brent was pushed up by the looming sanctions against Iran, which will start targeting its oil sector from November 4.

"U.S. (fiscal) tightening, higher oil prices and ongoing trade frictions are all taking their taking their toll on the growth outlook", HSBC said. "However, such optimistic claims are falling on deaf ears", PVM Oil Associates strategist Stephen Brennock said. President Donald Trump and King Salman bin Abdulaziz of Saudi Arabia spoke on the phone Saturday and discussed efforts to maintain supplies to ensure stability of the market and growth of the global economy, Al Arabiya TV reported.

Iran's seaborne exports in September hit its lowest since mid-2016 of 1.9 million barrels per day (bpd), according to trade data. Elsewhere, exports look set to continue its plunge with China's top refiner, Sinopec, looking to halve its oil imports from Iran to around 130k bpd.


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