OPEC won't react to Trump's threats, pushing Brent crude oil prices higher

Traders gathered at the Asia Pacific Petroleum Conference in Singapore anticipated oil prices to go back to the heady days of $100 per barrel levels. REUTERS

"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!".

"Saudi Arabia and Russian Federation confirmed that they not raising output - and this is bad news for President Trump as he wants a lower oil price that is good for business", said CMC Markets David Madden.

The United States from November will target Iran's oil exports with sanctions, and Washington is putting pressure on governments and companies around the world to fall in line and cut purchases from Tehran.

Crude oil futures have spiked in early Asian trade on Monday, a move unlikely to be welcomed by US President Donald Trump who took to Twitter late last night to express his displeasure at recent price gains.

The official further underlined the fact that OPEC's Joint Ministerial Monitoring Committee (JMMC) which set to meet on Sunday in Algiers has no authority to impose a new supply arrangement.

"It is now increasingly evident, that in the face of producers reluctant to raise output, the market will be confronted with supply gaps in the next three-six months that it will need to resolve through higher oil prices", BNP Paribas oil strategist Harry Tchilinguirian told Reuters Global Oil Forum. He sees US$90 oil by Christmas and US$100 in early 2019.

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Brent for November settlement rose $1.81 to $80.61 a barrel on the ICE Futures Europe exchange at 10:47 a.m.in NY.

"Fears that supply will be hit when the USA sanctions on Iran kick in come November are pushing up oil prices".

The U.S. trade balance between imports and exports widened during that time, with net imports reaching 4.54 million barrels per day in August, up 56 percent from two months prior. "This is because OPEC have essentially ignored President Trump's call to raise output to help lower prices", said Ashley Kelty, oil and gas research analyst at financial services firm Cantor Fitzgerald.

"The biggest issue is not with the producing countries, it's with the refiners, it's with the demand".

"OPEC did not guarantee that they would automatically replace lost Iranian barrels of oil due to sanctions", said Bob Yawger, director of the futures division at Mizuho Securities USA. "The reason Saudi Arabia didn't increase more is because all of our customers are receiving all of the barrels they want".

That suggests OPEC's power to influence the market will be tempered by USA production for about another decade.

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