Oil fell on Monday, reversing earlier gains after President Donald Trump told OPEC producers to “relax” as prices were too high.
Brent crude oil futures were down 91 cents at $66.21 a barrel, having earlier risen to a 2019 high of $67.47, while U.S. West Texas Intermediate (WTI) crude futures were down 74 cents at $56.52 a barrel.
“Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike – fragile!” Trump tweeted.
Members of the Organization of the Petroleum Exporting Countries together with non-OPEC producers such as Russia have agreed to cut production by 1.2 million barrels per day this year to help balance the market and support prices.
The oil price has risen by around 20 percent this year, aided primarily by OPEC’s production cuts, as well as U.S. sanctions on exports of crude from Iran and Venezuela.
Trump has frequently blamed high oil prices on OPEC while the United States has become the world’s largest supplier thanks to shale output.
Adding to the uncertain supply picture are Libya, where production has been frequently undermined by political tensions and violence, and Nigeria, Africa’s largest oil exporter, where as many as 39 people were killed in election violence over the weekend.
“Supply risk is ever present with Venezuelan tensions brewing a notch higher … the National Oil Corporation in Libya refusing to start production at the El Sharara field,” Harry Tchilinguirian, global oil strategist at BNP Paribas in London, told the Reuters Global Oil Forum.
Goldman Sachs analysts said on Monday that “the near-term outlook for oil is modestly bullish over the next two to three months,” but added that the outlook for later in 2019 was weaker due to surging U.S. exports and an “an increasingly uncertain economic, policy and geopolitical backdrop.”