Economy

OPEC member complains U.S. president is driving up prices

OPEC member complains U.S. president is driving up prices

What the new sanctions will be is not yet known, but previous sanctions on the Middle Eastern country saw a major drop off in oil exports that other OPEC members were only too happy to lap up. "Oil prices could rise at least $10 (a barrel), with Brent approaching near $90", Akuta said.

Ignoring pleas by allies, US President Donald Trump on Tuesday pulled out of an worldwide nuclear deal with Iran that was agreed in late 2015, raising the risk of conflict in the Middle East and casting uncertainty over global oil supplies.

The official said that "Following the USA decision to withdraw from the nuclear agreement with Iran, Saudi Arabia is committed to supporting the stability of oil markets for the benefit of producers and consumers and the sustainability of the global economic growth". If OPEC and Russian Federation kept in place their existing oil production cuts for 2018 and beyond, the price could even rise to $US100 before the end of next year, they said.

German Foreign Minister Heiko Maas gives a statement on May 9, 2018 in Berlin after U.S. President Donald Trump pulled the United States out of a landmark deal curbing Iran's nuclear program and reimposed crippling sanctions, defying European pleas and prompting worldwide outcry.

U.S. West Texas Intermediate (WTI) crude futures were down 7 cents at $71.29 a barrel, still not far off Thursday's November 2014 high of $71.89 per barrel.

At the same time, the analysts said the global economy is growing at a healthy pace and supporting higher demand for oil.

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"OPEC, as always, stands ready to support oil market stability, together with non-OPEC oil producing nations participating in the Declaration of Cooperation", OPEC said, using its name for the pact on supply curbs.

The main goal of the supply deal was to reduce excess oil stocks to the five-year average.

President Donald Trump's decision to exit the Iran nuclear deal has already pushed Brent prices above $77 per barrel. This would essentially end the OPEC-led deal to trim production.

Washington has given European firms doing business in Iran up to six months to wind up investments or risk USA sanctions and they are also forbidden from signing any new contracts with Iran.

Oil prices have climbed to a three-year high as the market prepares for Iranian exports to fall.

USA light crude CLc1 was down 66 cents at $70.70, off a 3-1/2 year high of $71.89 it hit on Thursday.