Global oil prices turned after President Donald Trump resumed his attack on OPEC to lower prices in light of the state of the “fragile” world. Prices dropped 2 percent after the president called on the organization to “relax,” according to Bloomberg.
On Monday morning, Trump sent out a tweet telling the Organization of Petroleum Exporting Countries that gas prices had climbed too much in recent months.
“Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike – fragile,” the president wrote.
Gas prices had reached a set of three-month highs after a round of price-boosting production cuts from oil-producing nations. Additionally, global risk assets had jumped in the past few days after Trump said that he would delay new tariffs on China, citing “substantial progress in trade talks between Washington and Beijing.” Tariffs were supposed to kick in on March 1.
His tweet caused prices in New York to drop 2.7 percent to $55.70 a barrel.
Trump has made OPEC a frequent target over the years as part of his political messaging in a low-risk strategy that wins him credit when oil prices drop, but sees the blame fall on OPEC when they climb, according to CNBC. Last year, Trump attacked OPEC, starting with a tweet in April, for artificially raising prices, resulting in wild swings last year that left many consumers unsure.
“Looks like OPEC is at it again. With record amounts of Oil all over the place, including the fully loaded ships at sea, Oil prices are artificially Very High! No good and will not be accepted!”
A few months later, after supply concerns caused oil prices to continue to rise, Trump sent out another tweet.
Oil prices are too high, OPEC is at it again. Not good!— Donald J. Trump (@realDonaldTrump) June 13, 2018
He followed that with another tweet a few days later.
Hope OPEC will increase output substantially. Need to keep prices down!— Donald J. Trump (@realDonaldTrump) June 22, 2018
OPEC increased output, but prices continued to climb after the Trump administration told oil buyers to cut oil imports from Iran by November of 2018, shocking the market. Trump was forced to make a call to world leaders to discuss oil prices.
“Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & disfunction [sic] in Iran and Venezuela, I am asking that Saudi Arabia increase oil production, maybe up to 2,000,000 barrels, to make up the difference…Prices to [sic] high! He has agreed!” he wrote.
With gas prices staying at a four-year high, Trump sent out another tweet. Meanwhile, the administration walked back its comments on Iranian oil imports, causing the market to stabilize.
The OPEC Monopoly must remember that gas prices are up & they are doing little to help. If anything, they are driving prices higher as the United States defends many of their members for very little $’s. This must be a two way street. REDUCE PRICING NOW!— Donald J. Trump (@realDonaldTrump) July 4, 2018
This sort of back-and-forth went on for the rest of 2018, with Trump threatening OPEC while working in the background to influence pricing as gas prices climbed and dropped along the way. By the end of the year, producers defied Trump’s calls to keep production high, cutting 1.2 billion barrels per day from the market in order to increase prices after they dropped 40 percent in the last quarter.
It appears that markets are in for another roller coaster after Trump’s latest tweet put oil-producing nations in a tough spot.