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Oil price jumps as Opec keeps output steady

Saudi energy minister rips Trump tweet: 'I do not influence oil prices'

But once the US sanctions on Iran take full effect, it will become clearer whether the Saudis are correct that the market is well-supplied, or whether the traders have picked a victor in tipping higher prices.

Brent crude futures were at 79.84 dollars per barrel.

Dated Brent could see the biggest overhaul since the North Sea crude became a benchmark more than 30 years ago as S&P Global Platts considers including oil from as far away as Central Asia, West Africa and US shale fields in its price assessment.

Higher gasoline prices for U.S. consumers could create a political headache for Republican Trump before mid-term congressional elections in November.

The September quarter of the year is typically the strongest for global crude demand, a situation that has been exacerbated this year by the looming reintroduction of economic sanctions on Iran from early November, including the nation's crude exports, contributing to recent strength in prices. Trump said last week that OPEC "must get prices down now!" but Iranian Oil Minister Bijan Zanganeh said on Monday OPEC had not responded positively to Trump's demands.

Brent crude, the benchmark for more than half the world's oil, rose 2.5 percent to $80.79 a barrel at 9:44 a.m.in London, the highest since November 2014.

Meanwhile, China's oil imports from Iran reportedly plunged by around 250,000 barrels per day (bpd) in August compared to a month earlier, though Beijing signaled its intent to keep buying.

Furthermore, it leaves the market extremely vulnerable to supply disruptions.

That equates to an increase of about 1 million bpd, but the latest figures show they are some way from achieving that target.

The biggest source of new global supply, USA shale, is also experiencing growing pains as pipeline bottlenecks and workforce issues hamper growth.

In August, OPEC and its allies cut production by 600,000 bpd more than their pact required, mainly as a result of falling output in Iran as customers in Europe and Asia reduced purchases ahead of the USA sanctions deadline. "We in Saudi Arabia have not seen demand for any additional barrel that we did not produce".

Al-Falih added that Saudi Arabia, the cartel's largest producer, still expects to pump more crude in September and increase output again in October. Russian Energy Minister Alexander Novak said in an interview with Bloomberg TV his country has the capacity to increase production by several hundred thousand barrels a day in the short term.