Oil producers led by Saudi Arabia and Russia signaled on Sunday that they did not see any rush to increase output, despite pressure from President Trump to pump more oil and hold down prices.
Officials from the Organization of the Petroleum Exporting Countries and allies including Russia, meeting in Algiers, said that after having increased production in recent months, customers now have adequate supplies. “Since June, Saudi Arabia has met the demand for every barrel that has been requested,” the Saudi oil minister, Khalid al-Falih, said at a news conference after the meeting.
The Saudis and their allies appear to be trying to walk a fine line between accommodating Mr. Trump and not putting so much oil into the market that prices crash — as they did in 2014, damaging their petroleum-dependent economies. “They are trying to assuage Trump while keeping internal OPEC division from blowing up in the open,” said Antoine Halff, a founding partner of Kayrros, a research firm based in Paris.
With oil prices recently hovering at around $80 a barrel for Brent crude, Mr. Trump has used Twitter and other means to lean on OPEC to increase oil supplies. His messages have mainly been directed at Saudi Arabia, the largest OPEC producer. Last week, Mr. Trump renewed his pressure. “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!” he wrote on Twitter on Thursday. “The OPEC monopoly must get prices down now!”
Analysts say Mr. Trump wants to try to head off higher gasoline prices in the United States that could hurt Republican candidates in the coming midterm elections. “Sitting presidents in an election year have a proverbial fear of high oil prices,” Mr. Halff said.
The agreement by OPEC and Russia in late 2016 to restrain oil production has contributed to a nearly 20 percent rise in Brent crude prices this year. Mr. Trump’s decision this year to reimpose sanctions on Iran has also helped push up prices, analysts say.
Traders are calculating that exports from Iran, a major producer, may dry up in the coming months. The full sanctions do not kick in until November, but analysts say Iranian sales are already falling as buyers in Europe and Asia cut orders because they fear being hit with financial penalties by Washington.
Responding to pressure from Mr. Trump, the Saudis and allies like Kuwait and the United Arab Emirates have increased production since May but not by the full one million barrels a day that Mr. Falih had indicated at OPEC’s last meeting in June. In a statement on Sunday, the OPEC group urged countries that could produce more oil “to work with customers to meet their demand during the remaining months of 2018.”
Analysts say that with the full impact of the sanctions on Iranian exports unknown, the Saudis and other OPEC producers are trying to avoid unnecessarily stoking tensions with Iran, a fellow OPEC member. The Iranians are resentful over the prospect that the Saudis and other OPEC members would gain market share at their expense.
While the markets may be adequately supplied now, they could be tested in the coming months, analysts say. Iran is not the only worry. Output from troubled Venezuela continues to decline, and fighting in Libya is raising doubt on whether that country can maintain its current high levels. “If the U.S., for the sake of argument, were to succeed in reducing Iranian shipments to zero, that would be extremely challenging indeed,” said Neil Atkinson, a senior analyst at the International Energy Agency, based in Paris.