High Oil Prices, no OPEC Plot: Iran2018-04-24 Iranian Minister of Petroleum Bijan Zangeneh has dismissed US President Donald Trumps recent-OPEC remarks, saying current oil prices have nothing to do with the oil producer group.
“Looks like OPEC is at it again. With record amounts of Oil all over the place, including the fully loaded ships at sea. Oil prices are artificially Very High! No good and will not be accepted!” Trump wrote on Twitter, according to Reuters.
Referring to Trump's recent tweet accusing OPEC for artificially boosting the prices in the oil market, the Iranian official said, "By such remarks, Mr. Trump addresses a certain group of Americans who may be unhappy with rising oil prices, while he would approve of increased prices."
Speaking to the Iranian Ministry of Petroleum official news website, Shana, Zangeneh said, "Our behind-the-scenes information suggests that Mr. Trump favors increasing prices so that he can ramp up US's crude and tight oil output as well as the country's tax income to generate more jobs."
The senior Iranian oil official described Trump's stance towards oil prices as dubious, saying, "On the one hand, Mr. Trump tries to improve the price of oil while, on the other, he blames OPEC for the upward trend of prices which do not have to do with the organization."
The Iranian Minister of Petroleum said Mr. Trump has reached an understanding with certain OPEC members, not all of them, for keeping the prices high.
Trump’s tweet came shortly after officials from top oil exporter Saudi Arabia said they would like to see prices climb even higher and that they were still far from their goal of ending the supply glut, Reuters said.
U.S. oil prices are near a three-year high, at close to $70 a barrel, and have been rising since OPEC and non-OPEC producers including Russia cut supply in January 2017 to end a global oil glut and price collapse.
U.S. West Texas Intermediate crude oil prices were up 9 cents at $68.38 a barrel, after dropping as low as $67.50 after Trump's tweet.
Sticking to OPEC Output Cut Unnecessary with current Prices: Zangeneh
Asked whether Iran would support extension of the OPEC output cut plan beyond 2018, the Iranian Minister of Petroleum further said, "No decision will be made regarding this issue in the upcoming OPEC meeting because the matter is unlikely to be included in the meeting's agenda."
OPEC's production-cutting deal has helped to boost oil prices following a prolonged rout that began in 2014.
He said if the prices keep growing with the current pace, extension of the deal would seem unnecessary.
"High oil prices, even in the mid-term, would destabilize the prices and put pressure on them against OPEC's interests."
The more expensive oil production increases, OPEC will have to reduce its output, leading to falling prices. Actually, unbalanced supply and demand would be damaging for OPEC, Mr. Zangeneh noted.
"I think that the balanced, non-fluctuating price of oil would be favorable for OPEC and other producers," he said.
The 174th OPEC meeting will be held on June 22 in Vienna.