President Trump pressuring OPEC to increase oil production ahead of crucial meeting

Oil prices tumbled about 3 percent on Thursday as OPEC reportedly agreed to cut production, but ended its closely-watched meeting without a decision on how much crude the cartel will take off the market. "We just have to see how it will be distributed", another delegate said.

"No, I am not confident", Saudi oil minister Khalid Al-Falih told reporters after coming out of a meeting of the Organization of Petroleum Exporting Countries in Vienna.

Oil was down $59.48 a barrel on Thursday, after a planned Opec press conference on the group's deal failed to materialise.

The price of crude has fallen nearly a third since October but Trump has demanded OPEC make oil even cheaper by refraining from output cuts. However, he noted that all the participants will be listened to in order to arrive at a consensus on the issue.

In one proposal being considered at talks on Thursday, OPEC could cut its own output by 900,000 to 1 million barrels a day and then seek further curbs from non-OPEC partners, one delegate said, asking not to be named as an agreement hasn't yet been reached.

U.S. President Donald Trump tweeted Wednesday that "Hopefully OPEC will be keeping oil flows as is, not restricted". The price of both benchmark USA crude and the standard for internationally traded oil fell 22 percent in November.

Riyadh wants Moscow to contribute at least 250,000-300,000 bpd to the cut but Russian Federation insists the amount should be only half of that, OPEC and non-OPEC sources said.

"A massive liquidation in long positions by money managers has dampened market confidence on oil prices considerably", said Benjamin Lu of Singaporean brokerage Phillip Futures.

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The Vienna meeting also comes only days after Qatar announced it would be the first country from the Middle East to withdraw from OPEC, saying it wanted to focus more on gas production.

Barclays said it expected "the global economy to slow over the next several quarters" although it added that "not one major economy is near recession". Its cooperation with Russian Federation shows how much OPEC has changed since 2016 when the two countries ended their historic animosity and started to manage the market together.

The group could eventually agree to remove about 1 million barrels a day, about 1 percent of global output, from the market, Al Rumhy said. A cut of a million barrels would be the minimum to support the market, and anything less could see the price of oil fall another $10 a barrel, according to Wilson.

Iran has said it is carefully monitoring the next steps by some OPEC members and their allies which have "arbitrarily" ramped up oil production, leading to a crash in prices.

If Russia contributed around 250,000 barrels per day, the overall cut could exceed 1.3 million barrels per day. Trump said on Twitter on Wednesday, Xinhua news agency reported.

While Saudi Arabia has indicated it is willing to cut production, its decision may be complicated by Trump's decision to not sanction the country over the killing of dissident journalist Jamal Khashoggi.

Saudi Arabia, OPEC's de facto leader, has made clear that it won't shoulder the burden of trimming production alone.

(Copyright © 2015. All Rights Reserved.)
 
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