Commodity Blog

Oil prices have endured a turbulent day, coming out slightly on top towards the end of trading. The commodity started the day well, making early gains, but they weren’t to last. Trump took aim at Saudi Arabia, after news emerged on Thursday that they want to see oil prices reach $80 or even $100 per barrel, making it highly likely that OPEC would agree to continue withholding supply of oil. OPEC members have been withholding supply since 2017. Although the deal is set to come to an end later this year, there are strong rumours that it will be extended.

Trump tweeted:

Looks like OPEC is at it again. With record amounts of Oil all over the place, included the fully loaded ships at sea, Oil prices are artificially Very High! No good and will not be accepted!

OPEC had said on Thursday that the global glut of oil supplies had nearly vanished, seeing Thursday prices end slightly lower, despite a bumper week. OPEC were meeting on Friday and responded to Trump’s tweet quickly, saying that there was no such thing as artificial prices.

The OPEC Secretary-General, Mohammad Barkindo, also said that OPEC was friends with Trump and that its members had a “vested interest” in seeing the country grow and prosper. Analysts have suggested that there is not much action Trump can take directly, other than to take oil from the Strategic Petroleum Reserve. As yet, there has been no suggestion of this happening.

Baker Hughes also announced that the total number of oil rigs in operation had risen by 5 to reach 820. This is the highest number of active rigs since 2015, and it is seen by investors and analysts as being a barometer of the market.

Oil prices ended the day with WTI crude down 0.01% at $68.32 per barrel and Brent crude trading at $73.83 per barrel, which was an increase of 0.07%.

If you have any questions and comments on commodities today, use the form below to reply.