Algeria warns Saudi Arabia, Russia against increasing oil output

The White House has backed off a tweet from President Donald Trump indicating he had convinced the king of Saudi Arabia to produce an extra two million barrels of oil per day

To make up for potential shortfalls in supply from Iran sanctions as well as other disruptions including Libya and Venezuela, the Organization of the Petroleum Exporting Countries (OPEC) has agreed with Russian Federation and other oil-producing non-OPEC members to raise output from July.

The United States aims to reduce Tehran's oil revenue to zero in an effort to force the Iranian leadership to change its behavior in the region and believes there is enough spare global oil capacity to make up for lower supply from Iran, a senior U.S. State Department policy adviser said on Monday.

The vice president also noted that the "vulnerable" social layers should be helped after re-imposition of sanctions. The White House has said the USA will put those sanctions back into place.

"The Trump administration's plan for Iran sanctions is now abundantly clear".

Saudi Arabia doesn't seem to be in a rush to fulfill Trump's request for an extra 2 million barrels per day. "So in the options market, the volatility gets bid up", he told the Reuters Global Oil Forum.

Oil surged in the past two weeks as the USA pushes allies to end imports of Iranian crude, disruptions persist in places like Libya and American crude inventories shrink.

"It has no meaning for Iranian oil not to be exported, while the region's oil is exported".

Monica Malik, chief economist, Abu Dhabi Commercial Bank, welcomed the UAE's decision to hike output later this year as it will bring stability in the oil market and also improve government revenues from hydrocarbon sector.

An Indian official says his country, which imports 400,000 barrels per day of Iranian crude, would only recognise multi-lateral sanctions, rather than unilateral sanctions.

Iran will allow private companies to export crude oil, part of a strategy to counter USA sanctions, and is urging fellow OPEC members, including regional rival Saudi Arabia, not to break output agreements, state media and officials said on Sunday.

This most recent Twitter post also made it look like USA policy is reliant on Saudi Arabia's spare capacity to fill global supply gaps, the analysts wrote.

Those tweets implied that supply deficits will require all of the world's remaining spare production capacity to come online, according to Standard Chartered.

US President Donald Trump sent a message on Twitter that he asked Saudi Arabia to increase oil output by 2 million barrels because "prices to (sic) high".

This was due to outages around the world from Libya to Canada and Venezuela are keeping priced elevated. "But as with our other sanctions, we are not looking to grant waivers or licenses". "Of course. That's what we're doing, absolutely", he said.

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