Trump's attempt to reduce oil prices makes the screw on American drilling machines
President Donald Trump praises for oil prices to fall even further after an impressive jump over the past seven weeks. The US oil and gas industry, a pillar in Trump's political base, is probably less enthusiastic.
This year's oil price rally has collapsed rapidly as a fears Potential oil stocks allow for forecasts that commodity supply will shrink demand next year. The sale is pushing US raw prices to Levels that could affect drillers' spending plans and their ability to return money to shareholders.
"Exxon, Chevron, BP will survive because they are so big, but some of the smaller companies may have problems as costs rise and sales decline." Andrew Lipow, president of Lipow Oil Associates.
US crude futures stumbled from almost four-year high at $ 76.90 on October 3 to over one year low at $ 50.53 on Friday. From peak to trough, US crude has lost more than a third of its value.
Oil drop below $ 55 earlier this week was apparently not enough for Trump esident took Twitter to praise Saudi Arabia for hiking exit and help to cover oil prices. Trump asked the kingdom to hold on and said "let's go lower!"
Trump sent tweet one day after he told his support to Saudi Arabia and took bipartisan talks to punish the kingdom after the Saudi agents murdered journalist and American resident Jamal Khashoggi last month. The CIA has allegedly concluded that the Saudi crown prince Mohammed bin Salman has ordered the killings, but Trump has doubted this review throughout the week.
Presidential defense of Saudi Arabia comes about two weeks before a critical OPEC meeting on 6 December. Trump wants the Saudi Arabian group to continue pumping at full tilt, which will keep a lure on oil prices.
In recent weeks, the OPEC cartel from 15 countries and several other exporters have signaled that they will accept a price-boosting output cut. But Trumps takeovers to saudis can make it harder for the kingdom to support tension back production.
"It seems that they will rely on it," John Kilduff, founder of the Energy Capital Fund Again Capital, told CNBC's "Squawk Box" Wednesday. "Our relationship with them seems to have been bought and paid for now, and the oil market's MVP, President Trump, helps keep a cover on prices."
