Oil Producers Follow Trump’s Tariffs With a Surprise Increase
Eight members of the OPEC Plus Oil Cartel, led by Saudi Arabia, declared Thursday that they would accelerate their program previously expected to gradually add about 2.2 million barrels per day to the oil market.
The producers, including Russia, will add 411,000 barrels combined per day in May, equivalent to three monthly increases, said in a press release. They had already agreed in March to start producing more oil This month.
Oil prices decreased abruptly on Thursday, weighted both by fear that an increase in commercial affairs silurò the global growth and the prospect of an increase in oil supplies. Brent’s crude oil, the international benchmark, dropped by 6 % and the intermediate of western Texas, the American standard, dropped by 6.6 percent.
The falling oil prices were some good news for the global economy on a day when share markets Around the world he fell after President Trump has revealed rates on American commercial partners.
The decision could be seen as a gesture for Mr. Trump, who tried to reduce gas prices for American consumers, by some members of the group, in particular Saudi Arabia. The kingdom warmly responded to the re -election of Mr. Trump. Recently, he acted as a guest for the talks, led by the officials of the Trump administration, aimed at ending the war in Ukraine, which Russia invaded in 2022.
The countries declared in a press release that were acting “in view of the continuous fundamental fundamental market”.
“While the officials insist that the move has not been designed to appease Washington, President Trump will undoubtedly welcome lower prices,” wrote Helima Croft, Global Head of Commodity strategy at the RBC Capital Markets investment bank, in a research note on Thursday.
Mrs. Croft also said that the move also had the purpose of sending a message that the Saudis would not tolerate it if the other members of the group had passed their shares and did not hesitate to increase production to reduce prices and punish “cheating”.
“It is a high -level move, but I think it is destined to establish credibility/deterrence,” said Mrs. Croft.
Just five years ago, the Saudis increased production To produce Russia to continue to collaborate with market management.
If such a warning was destined for Thursday, Kazakhstan would be a probable goal, Mrs. Croft said. He estimated that Kazakhstan exceeded its share of 700,000 barrels on March. An expansion led by Chevron of the Tengiz oil field Close to the Caspian Sea promises to add even more oil.
