"We are moving into an environment where supply disruptions are visible all over the world. and of course President Trump has been pretty active in trying to isolate Iran and getting USA allies not to purchase oil from Iran", he added. The king said he was ready to boost production if needed, the White House said in a statement.
An issue that compels me to write to Your Excellency is that we have not arrived to any decision to assign any allocated production level of any member to others. That's up about 55 cents from the same period past year, at a time Trump's Republican Party is trying to hold on to its majorities in Congress in the November midterm elections.
Iran expressed in the JMMC meeting that any unilateral production increase beyond Member Countries' commitments under the OPEC's decisions would prompt USA to take actions against Iran.
Perry said the United States remains ready to tap the Strategic Petroleum Reserve, the country's emergency stockpiles, if necessary, but that at the moment "I wouldn't recommend it".
Riyadh does not "like" raising its oil production not at least beyond 11,000 barrels per day (bpd), says a Saudi official. And Venezuela's oil output was around 540,000 bpd below its target level in May.
Oil cartel OPEC and Russian Federation have agreed to raise output by around 1 million barrels per day (bpd), with Saudi Arabia planning to pump 11 million bpd in July, an oil industry source told Reuters this week.
Benchmark Brent crude LCOc1 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. Hence, Opec and other non-Opec countries could potentially plug any gap.
Supply disruptions boost oil prices. These mainly include Saudi Arabia, Russia, the UAE, Kuwait, Iraq and Kazakhstan.
Enhancing production largely benefits Saudi Arabia as most other member countries are now pumping oil close to its capacity or losing output due to various reasons. "Russian Federation could increase its output by 300,000 bpd, while others [Kuwait, the UAE and Iraq] increase by 300,000 bpd", Iradian said.
Opec agreed with Russian Federation and other oil producers to raise output by a million barrels per day earlier this month. Trump's tweet offered no timeframe for the additional 2 million barrels - whether that meant per day or per month.
Oil prices increased Friday as USA sanctions against Iran threatened to remove a substantial volume of crude oil from world markets at a time of rising global demand.
"Europeans guarantee that Iran will be able to sell its oil, although Americans are considering their own measures in this regard (limiting Iran's oil sales)", Zarif said on June 24. Moreover, increased production by GCC countries will also reduce any market fears of further supply shortages especially as Iranian sanctions take hold in November.
Tracking worldwide prices, domestic crude futures surged to its highest level since September 2014 recently.
The Russian-Saudi-led deal for Russia and OPEC to cut production in 2017, which was extended for 2018, was seen as one of the main cause of the price spike. This is one of Trump's plans to pressure the US' allies into cutting off funding to Iran.