Commodity: Oil Prices Decline on Trump’s Call to OPEC
COMMODITY – On Friday, oil prices declined in Asia following the call of US President Donald Trump to OPEC in lowering crude prices before their meeting in Algeria on Sunday.
The November delivery of Crude Oil WTI Futures dropped 0.18% to $70.19 a barrel. Meanwhile, the November delivery of Brent Oil Futures stayed at $78.7 per barrel.
“We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices! We will remember. The OPEC monopoly must get prices down now!” Trump tweeted.
The Algeria meeting on Sunday will be attended by OPEC and non-OPEC members including Russia. The expected meeting will discuss the sharing supply increases to counterbalance the deficit in exports from Iran because of the US crude sanctions in November.
The remarks put “a focus on the likely supply impacts of U.S-led Iran sanctions. The market had until that point been trading fluidly with the assumption that Saudi Arabia is now comfortable with Brent at $80 or even higher, which is challenging the market’s long-held supposition that prompt Brent between $70 and $80 was OPEC’s sweet spot,” said Stephen Innes, OANDA head of trading for Asia-Pacific.
According to a source, Saudi Arabia expressed concerns that the spike in oil prices will bring condemnations from Trump. Moreover, the country is worrying about a lack of spare oil capacity.
“It’s complicated. Saudi Arabia has to balance oil supply and demand, and it has to balance oil prices so they don’t rise too much before the U.S. elections. It’s also political because the Saudis don’t want to pump too much oil then the Iranians complain to OPEC that it is taking [Iran’s] market share. They also don’t want oil prices to fall too much,” the source said.
Meanwhile, Oil Minister Bijan Namdar Zanganeh flagged warnings that Iran would veto any decision from OPEC that can cause harm to the country. Further, it said that there were attempts by some oil producers in creating additional forums that would support US policies hostile to the Tehran government. However, he was unable to provide specifics on any actions on how to block the decision.
Commodity: Gold Increases as Dollar trades further gains
On Friday, the gold prices increase and are set to make its first weekly gain in four. Meanwhile, the greenback also traded with further gains however, it is still hovering close to lows within two months.
Based on the Comex division of the New York Mercantile Exchange, the December delivery of Gold futures increased 0.2% to $1,214.00 per troy ounce. The US dollar index climbed 0.04% to 93.51.
