Oil goes to the worst month in two years, under pressure from Trump Saudi Arabia

A handful of big overnight losses in July pushed the oil market to its steepest monthly decline in two years – and the source of these big swings can often be attributed to the White House.

U.S. Crude prices actually rose in 13 of the 21 sessions of the month, while Brent is also up in 13 of the 22 trading days. However, most of the daylong gains were moderate, as both benchmarks climbed more than $ 1 per barrel only once this month.

Meanwhile, Brent lost nearly $ 11 spread over the first three weeks of July. US crude oil lost nearly $ 8 for as many days over the same period. A last day of heavy losses on Tuesday meant that both futures had their worst monthly decline since July 2016.

As the month approached, oil prices were sharply recovering after the first two months of the month. a State Department official told reporters that Iran's purchases to zero by Nov. 4. Trump reinstated sanctions on Iran in May, but the delay in reducing imports was more aggressive than the market had anticipated and raised fears of oil shortages. [2]

But a few days later, on July 2, the Brent crude lost nearly $ 2 a barrel after Trump said on Twitter that the King of Saudi Arabia had agreed to pump up to $ 20 a barrel. an additional 2 million barrels a day to tame fuel prices. The White House later came back on this claim, saying that the king would take an increase into consideration

I just spoke to King Salman of Saudi Arabia and explained to him that because of turmoil and disorder in Iran and in Venezuela, I ask that Saudi Arabia increase oil production, perhaps up to 2,000,000 barrels, to make up the difference … Prices are high! He accepted!

– Donald J. Trump (@realDonaldTrump)
June 30, 2018
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The same day, Reuters predicts Saudi Arabia's oil production jumped 700,000 bpd in June. Meanwhile, the Russian Minister of Energy said that he had increased his production by more than 11 million bpd this month. Both headlines implied that Saudi Arabia and Moscow were keeping their promise to increase production in order to avoid overheating the market.

July 5: Rising Trump crude stocks and tweets at OPEC

Two days later, WTI experienced its first big drop for the month, falling 1.20 $ a barrel after weekly data showed a surprise jump in US crude inventories.

Earlier in the day, Trump lobbed the latest in a series of Twitter critics at OPEC. the world's cartel to reduce prices immediately. This fueled speculation that Trump was impatient with relatively high fuel prices and was considering selling oil from the country 's emergency reserves. (A week later, details of a plan to do just that have leaked.)

@realDonaldTrump: The monopoly of OPEC must remember that gas prices are rising and that They do little to help. On the contrary, they drive up prices, because the United States defends many of its members for very little money. It must be a two-way street. REDUCING PRICES NOW
July 11: Libya and Saudis bring relief, Trump applies tariffs to China

Brent and US crude oil both recorded their largest daily decline on 11 July. its crude oil exports and Saudi Arabia recorded a jump of nearly 500,000 bpd from its oil production. Brent dropped $ 5.46 a barrel, while US crude closed the day down $ 3.73.

Also that day, oil prices fell along with stock markets. The trade dispute between nations – home to the world's two largest economies – has weighed on oil markets because it threatens to slow world growth and cool crude oil demand.

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The last big drop came on July 16, with the US crude losing close to $ 3 a barrel and Brent falling $ 3.50 a barrel.

That day, Treasury Secretary Steve Mnuchin eased market fears. some oil buyers reduce their purchases of Iran more gradually. Mnuchin told reporters that the administration wanted to avoid oil markets in trouble while she was pursuing her policy in Iran.

July 31: The OPEC and Russia reborn, Trump said he would meet Iran

gross dropped $ 1.37, or 2 to cent, a barrel at $ 68.76, down 7.3 percent this month. Brent fell 1% to $ 74, down from about 6.5% in July. The latest declines came as a Reuters poll of analysts had forecast another leap in OPEC production for July and Russia said its oil output would hit a record 30 million US dollars. euros this year.

In the Saudi and Russian market, I think in the short term, it's negative because we have not yet lost the Iranian casks, "said Kilduff

. meeting the Iranian president without preconditions took some of the geopolitical risk premium on oil prices.However, Kilduff noted that Iranian officials rejected Trump's remark.

US Secretary of State State Mike Pompeo also appeared to be covering himself in an interview with CNBC, listing several conditions for a summit with Iran.