Oil price raced towards the $80 per barrel level Tuesday after OPEC and said the cartel and its allies were doing what they can to offset crude output shortfalls that have kept global supplies tight and prices high, but that they don’t want to overdo it.
The message came from United Arab Emirates Energy Minister Suhail Al Mazrouei after being asked about U.S. President Donald Trump’s call for the group to do more.
Brent is trading at above $79 a barrel Tuesday after adding 94 cents while the US grade crude is selling at $74.22 having added 37 cents on the day and the brightening oil market prospects add to optimism in countries like Nigeria that depend almost entirely on oil export for foreign earnings.
The UAE minister said it’s important to avoid bringing the market back to the kind of excessive supply that triggered the recent downturn.
“It’s unfair to say that OPEC is not doing its part,” Al Mazrouei, who’s also serving as president of OPEC, said in a TV interview with Bloomberg BNN in Calgary. “There are things outside of our hand, the geopolitics as well as how much production is coming from the shale oil and Canadian sands.”
Oil futures are trading near three-year highs as disruptions in Canada and Libya, along with slumping production in Venezuela and a U.S. call for allies to stop buying from Iran, have overshadowed a pledge by OPEC and allies to add 1 million barrels a day.
Surging prices led Trump to take to Twitter on July 4, accusing OPEC of “doing little to help” and urging the group to “REDUCE PRICING NOW!”
A day later, Saudi Arabia’s state producer lowered August pricing for most crude grades in Asia and Europe and cut them for all grades headed to the U.S.
The kingdom was also said to have increased daily output by about half a million barrels in June.
“We need to just give it time to enter the market,” Al Mazrouei said of the extra supply. “When a major consuming country speaks, we listen — we listen to the United States, we listen to China, we listen to India.”
