Crude oil tumbled on Friday after President Donald Trump blasted the OPEC on Twitter, accusing the consortium of artificially boosting oil prices.
Crude oil futures for May 2018 traded down 0.04% at $68.26 on the NY Mercantile Exchange, and the futures for June 2018 declined 0.25% to $68.16. Geopolitical tensions were behind crude oil prices.
Trump tweeted about the Organization of the Petroleum Exporting Countries (OPEC), “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!”
Crude oil had risen to $69.45 on Thursday after Saudi Arabian officials told Reuters they were expecting higher oil prices — about $80 or $100 a barrel. In the midst of all this, OPEC had been lowering crude production by 1.8 million barrels per day to boost oil prices. An Energy Information Administration report stated that crude oil inventories dropped by 1.07 million barrels in the week ended April 13.
Meanwhile, Russia is reconsidering production cuts quotas after energy minister Alexander Novak said the country would assess the market situation — which will be monitored over the next two months — at the next meeting in June.
Iraqi oil minister Jabar al-Luaibi added to this, saying that prices are not very high as the market is stabilizing now.
The International Monetary Fund (IMF) this week said they expect oil to fall below $60 next year, down from this year’s expectations of $62.31. Citing to a slower global economic growth, IMF predicts oil prices to fall to $53.60 a barrel by 2023.
IMF is upbeat on the world’s economy in 2018 and 2019 that should convert into higher oil demand. These forecasts are, of course, sensitive to the US-China trade conditions, which seem to have taken many significant turns in the past couple of months.