US President Donald Trump has advised OPEC ahead of its meeting today, to keep crude flowing and not curb supply as he continued to lobby for lower prices.
“Hopefully OPEC will be keeping oil flows as is, not restricted. The World does not want to see, or need, higher oil prices!,” he tweeted on Wednesday.
The exporters’ group will convene in Vienna, where OPEC and its allies will consider adopting output restricting measures following a dramatic 30 per cent decline in the price of oil since early October.
President Trump called the price crash, which saw the price of Brent fall from $86 per barrel in October to $60, “a tax cut for America and the world”.
Mr Trump has repeatedly tweeted ahead of OPEC meetings and has exerted pressure on the group and its allies led by Russia, collectively known as OPEC, to keep prices low, particularly ahead of the US midterm elections that took place in November.
While Mr Trump may consider lower prices a boon for US consumers, it couldn’t come at a worse time for the country’s domestic energy industry.
Record-high US supply of shale, rather than the May reversal of output curbs by OPEC, has been behind the latest oil price crash.
Mr Trump’s granting of waivers to eight countries importing crude has contributed to the rout at a time when OPEC turned on the taps to make up for expected oil shortage after sanctions imposed on Tehran in November.
Low crude prices will likely hurt the growth of US shale more than any other energy industry, according to analysts.
Observers suggest that any OPEC communique from today’s meeting will be coded in diplomacy to signal tightening output, while at the same time ensuring the measures won’t prompt outbursts from Mr Trump.