WASHINGTON DC - US President Donald Trump has urged the Saudi Arabian government to increase its oil output by two million barrels per day. Reported by the BBC, Saturday (30/6/2018), the increase in oil production is believed to overcome the increase in fuel costs.
Through Twitter, Trump explains if King Salman approves his request to increase the amount of oil production. Also read: Apparently There is a verdant Farmland in Saudi Arabia Trump said the move is needed to overcome the turmoil and dysfunction in Iran and Venezuela. "Just talked to King Salman from Saudi Arabia and explained to him about the chaos and dysfunction in Iran and Venezuela," through his twitter.
Meanwhile, Organization of Petroleum Exporting Countries or OPEC agreed to increase output as Russia did, but failed to convince the market. The Saudi news agency confirmed Trump and King Salman had spoken over the telephone line.
Both reportedly addressed need to maintain the stability of oil market. However, statements from the Saudi news agency did not mention that the government agreed on 2 million barrels per day. Saudi Arabia is the world's biggest oil exporter and generated about 10 million barrels per day in May. The country has 1.5 million to 2 million barrels per day for spare capacity.
"Saudi Arabia does not really want to surpass 11 million barrels per day and does not intend to expand its current production capacity," a Saudi official told The Wall Street Journal.
Oil prices rose last week, partly due to US plans to reinstate sanctions against Iran, one of the world's top oil producers.
CBC News reported an increase in oil prices also because the Trump government encouraged allies to end oil purchases from Iran, after the US withdrew from a nuclear deal between Iran and other world powers. In addition, the rise in oil prices was triggered by the ongoing turmoil in Venezuela and the fighting in Libya.
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