Saudi king agrees to ramp up oil production, Trump says

Crude Oil

Crude Oil

If so, such a boost would be significant for the country's oil production, which hit 10.03 million barrels per day (bpd) in May.

Kuwait will increase its oil production by 85,000 barrels per day (bpd) Sunday, as part of a broader OPEC agreement to raise production by one million bpd, according to energy Minister Bakhit al-Rashidi.

The OPEC cartel recently agreed to pump 1 million barrels more crude oil per day.

It was not immediately clear what total level of Saudi production Trump was expecting or by when.

This week, a US State Department official said Washington would work with countries on a case-by-case basis to try and stop them importing Iranian oil.

Saudi King Salman and US President Donald Trump emphasised the need to preserve oil market stability and the efforts of oil-producing countries to compensate for any potential shortage, in a phone call reported by Saudi state media on Saturday.

The development comes days after Saudi Arabia, the world's biggest oil exporter, agreed to go all in with production.

Benchmark Brent crude was trading around $79 a barrel on Friday, and a Reuters poll showed prices look to remain strong for the rest of this year due to supply disruptions in countries including Libya and Venezuela and as the extra oil from Opec fails to meet rising demand.

Oil output averaged 10.97 million barrels a day in May, nearly unchanged from a month earlier, according to data emailed Saturday by the Energy Ministry's CDU-TEK statistics unit. A gallon of regular gasoline sold on average in the USA for $2.85, up from $2.23 a gallon past year, according to AAA. Later on Saturday, the Saudi SPA news agency also reported about the conversation between Trump and Salman but has not mentioned the agreement announced by Trump.

USA crude prices for the front-month contract jumped by just over 8% for the week, nearly 11% for June and rose over 14% for the second quarter. "Russian Federation could increase its output by 300,000 bpd, while others [Kuwait, the UAE and Iraq] increase by 300,000 bpd", Iradian said. Its record is 10.72 million barrels in a day. Against a backdrop of calls from the US, China, and India for more oil supply to stabilise the market, OPEC chose to raise output.

The Trump administration is pushing other countries to cut all imports of Iranian oil, while it slapped further trade sanctions on Venezuela last month.

U.S. West Texas Intermediate (WTI) crude futures were at $73.17 a barrel at 0049 GMT, down 28 cents, or 0.4 percent from their last settlement.

Almost 4 million barrels of USA crude are due to arrive in Japan, the world's fourth biggest oil importer, between June and September, according to the sources and Thomson Reuters Eikon shipping data. Estimates vary, but Saudi Arabia may have the ability to produce as much as 12.5 mb/d, although perhaps less. The market's attention has shifted to a spate of disruptions after weeks of focus on supply coming online from OPEC and other major producers, she said. This is one of Trump's plans to pressure the US' allies into cutting off funding to Iran.

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