Trump Calls for No Oil Production Cuts from OPEC

Ahead of the OPEC meeting, U.S. President Donald Trump has urged members of the organization not to reduce their oil production. The 175th OPEC meeting is scheduled for Thursday, December 6, in Vienna, Austria. Trump tweeted, "I hope OPEC will maintain oil production at current levels and not restrict it. The world does not need and does not want to see rising oil prices." This meeting comes as oil prices have fallen in global markets and Qatar has announced its withdrawal from the organization. In this context, Iran's representative at OPEC warned on Monday that if oil production is not reduced, oil prices in global markets will fall further. Following the news of Qatar's exit from OPEC, Hossein Kazempour Ardebili, Iran's representative at OPEC, told Reuters, "It is regrettable, and we understand their (Qatar's) disappointment. Many other OPEC members and allied countries are also disappointed with the unilateral decision of the OPEC monitoring committee to increase production. They (Saudi Arabia and Russia) have caused a $30 drop in prices since May with significant excess oil production." He added, "Two pilots (Russia and Saudi Arabia) have caused the fall of all 25 passengers (OPEC members and allied countries), and other small oil-producing countries no longer consider themselves worthy of membership in OPEC." The U.S. exited the nuclear deal with Iran on May 8 and reinstated all sanctions against Iran. To compensate for Iran's oil exports, the U.S. supports increasing oil production in the global market to prevent oil prices from rising when Iran's exports decrease. In this context, TASS reported that OPEC members and Russia have agreed to reduce oil production and return to the 2016 quotas, and OPEC members are likely to agree on such a reduction. Reuters states that if such an agreement is reached, OPEC's oil production will decrease by about one million barrels. OPEC and allied countries led by Russia had committed to reducing their daily production by about 1.8 million barrels since the beginning of 2017. Earlier this year, due to excessive declines from some members, especially Venezuela, these countries decided to increase their production by one million barrels, and the OPEC monitoring committee was tasked with overseeing the increase in production. During this period, Venezuela's production fell by 200,000 barrels and Iran's by one million barrels, but production from some members increased to the point that not only compensated for this decline but also added a significant amount of surplus oil to the market. Total OPEC production last month reached 33 million and 110 thousand barrels, showing an increase of about 600,000 barrels compared to May. Consequently, oil prices have dropped from $86 in early October to about $61 currently.