Trump says Saudi Arabia has agreed to increase oil production

2017 shows an oil facility on Khark Island on the Gulf. The US warned this week that countries must stop buying Iranian oil before November 4 or face economic sanctions. A State Dept official said tightening the noose on Tehra

Trump says Saudi Arabia has agreed to increase oil production

The US push to curb countries' imports of Iranian oil comes after President Donald Trump withdrew from a 2015 deal between Iran and six world powers and ordered a reimposition of sanctions on Tehran.

However, Saudi Aramco CEO Amin Nasser told journalists in India on Monday that the state oil company has spare capacity of 2 million barrels of oil a day.

But oil officials cited by The Wall Street Journal said it is debatable whether the kingdom would be able to raise output by the amount Trump suggested.

President Trump requested that Saudi Arabia's King Salman boost his country's oil production by 2 million barrels in order to offset any potential shortages caused by turmoil and unrest in Iran and Venezuela. "He has agreed!" read the tweet.

The statement did not mention any intention by Saudi Arabia, the world's top oil exporter, to raise production to 2 million barrels per day.

"During the call, the two leaders stressed the need to make efforts to maintain the stability of oil markets and the growth of the global economy", SPA said.

Recently, OPEC and its allies agreed to increase daily production limits at their latest meeting held at Vienna.

There was no confirmation, however, that the Saudi regime would boost its oil production, as claimed in Trump's tweet. That's highly ironic because Trump had been whingeing about higher oil prices and urging higher production. The figure is higher than agreed by the Organization of Petroleum Exporting Country last week.

Saudi Arabia, meanwhile, is planning to pump as much as 11 million barrels per day (bpd) of oil this month, about 1 million more than it is producing now, an industry source told Reuters this week.

That might be fine by Trump, who earlier this month blamed rising prices on OPEC, but has fostered close ties to Saudi Arabia.

Saudi Energy Minister Khalid al-Falih met with U.S. Secretary of State Mike Pompeo in Washington on Thursday to discuss energy security. Officials didn't immediately respond to a request for comment.

"Saudi Arabia can use some of its stocks to boost exports, visible to the USA president, while it takes time to ramp up operating capacity", said Olivier Jakob, head of Swiss-based consultant Petromatrix GmbH.

"Added to the losses from Venezuela, is there enough capacity to replace the lost Iranian volume??" it asked, insisting that "it is highly doubtful".

However, the U.S. Energy Information Administration estimated that OPEC crude production only decreased from 32.7 million barrels per day in 2016 to 32.5 million in 2017, a drop of less than one per cent. It would also likely aggravate other OPEC members, such as Iran and Venezuela, which initially sought to prevent any increase as OPEC, along with allies led by Russian Federation, headed into their Vienna meetings earlier this month.

A senior State Department official said this week that countries will need to cut their imports of Iranian oil to zero from November and exemptions are unlikely.

Oil Minister Dharmendra Pradhan in Mumbai said India will decide on Iranian imports keeping its best interest in mind.

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