The U.S. government has quietly asked Saudi Arabia and some other OPEC producers to increase oil production by about 1 million barrels a day, Bloomberg reports.
The rare request came after U.S. retail gasoline prices surged to their highest in more than three years and President Donald Trump publicly complained about OPEC policy and rising oil prices on Twitter.
The request was debated at a meeting of some Arab oil ministers over the weekend in Kuwait City, and a statement published after the talks pledged to “ensure stable oil supplies are made available in a timely manner to meet growing demand and offset declines in some parts of the world.” Saudi Arabia and Russia last month proposed a gradual production increase, although other members of the group have yet to agree.
Benchmark Brent oil futures dropped as much as 1.5% to $74.16 a barrel in London trading this morning after the U.S. request was reported.
OPEC and a group of non-OPEC countries including Russia, Mexico and Kazakhstan agreed in late 2016 to cut oil output by a combined 1.8 million barrels a day in an effort to boost oil prices. Brent crude, the global benchmark, has risen from less than $45 a barrel before the deal was signed to more than $80 a barrel last month.
OPEC and its allies will discuss their production policy for the second half of the year in meetings scheduled on June 22 and 23 in Vienna.
