Crude-oil futures marked their lowest settlement in more than a week on Monday as President Donald Trump blamed OPEC for a recent resurgence in prices, calling for moderation.
“Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike – fragile!” Trump tweeted.
Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike – fragile!
— Donald J. Trump (@realDonaldTrump) February 25, 2019
“Investors have been getting a clear reminder of the sway U.S. President Trump still holds; how a comment or tweet on a key economic issue can really swing sentiment,” said Colin Cieszynski, chief market strategist at SIA Wealth Management.
April West Texas Intermediate crude
fell $1.78, or 3.1%, to settle at $55.48 a barrel on the New York Mercantile Exchange. It had traded as high as $57.53 early Monday amid apparent progress on U.S.-China trade talks.
Global benchmark April Brent
dropped $2.36, or 3.5%, to $64.76 a barrel on ICE Futures Europe—the biggest one-day dollar and percentage decline year to date, according to Dow Jones Market Data. Both WTI and Brent settled at the lowest for a front-month contract since Feb. 14.
“Crude oil prices had a subdued start for the week and then we’ve had this tweet from the president saying that the prices are getting too high and OPEC has to do something,” said Matt Smith, director of commodity research at ClipperData.
“It’s not surprising to have him tweeting now because we’ve had a really decent price rally in the past month or so, since the beginning of the year, really. We’ve seen crude prices getting swept up with general market sentiment. His base is seeing prices at the pump ticking higher and given the lag nature of retail gasoline prices, they’re only going to head higher from here.”
From the archives: Why Trump is tweeting about OPEC—and what he can do about oil prices
Still, OPEC looked to ignore Trump’s call, with the The Wall Street Journal reporting that officials in the Organization of the Petroleum Exporting Countries said OPEC was planning to back a continuation of oil-production curbs when the group meets in April.
OPEC and 10 partner producers outside of the cartel, led by Russia, agreed late last year to cap crude output by a collective 1.2 million barrels a day for the first half of this year. OPEC production has also been declining as a result of U.S. sanctions on the oil industries of cartel members Iran and Venezuela, both of which were exempted from the latest production-cut deal.
The extension would ease worries about global energy demand, but U.S. crude output and supplies continue to climb.
“U.S. output hitting records of 12 million barrels per day is countering the positives from easing trade tensions, sanctions on Iran and Venezuela and OPEC cuts,” said Jasper Lawler, head of research with London Capital.
Elsewhere, the situation in Venezuela intensified over the weekend, with the nation’s opposition calling on the international community to consider the use of military force against President Nicolás Maduro, after a weekend showdown over humanitarian aid ended in violence.
In Africa, Nigerians headed to the polls Sunday after the country’s elections were postponed amid Islamist terrorist attacks, The Wall Street Journal reported. In Libya, the chairman of state-owned oil firm NOC refused to resume production at the country’s largest offshore oil field while an armed group remained on the premises, Reuters reported.
On Nymex Monday, March gasoline
fell 4.1% to $1.545 a gallon and March heating oil
eased by 2.8% to $1.974 a gallon. March natural gas
which expires at Tuesday’s settlement, settled at $2.836 per million British thermal units, up 4.4%.
Mark DeCambre contributed to this article
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