President Trump spoke with Saudi Arabia’s King Salman Saturday morning and asked him to increase his country’s oil production, a move that likely factors into the administration’s strategy to isolate and put economic and political pressure on Iran.
Global oil prices rose drastically in response to the White House’s recent announcement of a zero-tolerance sanctions campaign on Iranian oil importers. Following the announcement, prices broke $70 a barrel for the first time since May, and Trump’s request of the Saudis is an obvious move to tamp down on rising costs.
Last week, Trump warned European Union members to cut Iranian oil imports to “zero” by November or face strict sanctions, a direct response to the failure of the Iranian Nuclear Deal and the United States’ withdrawal from the framework last month.
A State Department official additionally told reporters that U.S. representatives will soon visit Europe and Asian countries to issue first-hand warnings to governments about the sanctions. Currently, China, India, South Korea and Japan are the largest importers of Iranian oil.
“Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & disfunction in Iran and Venezuela, I am asking that Saudi Arabia increase oil production, maybe up to 2,000,000 barrels, to make up the difference,” the president tweeted Saturday morning. “Prices to high! He has agreed!”
Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & disfunction in Iran and Venezuela, I am asking that Saudi Arabia increase oil production, maybe up to 2,000,000 barrels, to make up the difference…Prices to high! He has agreed!
— Donald J. Trump (@realDonaldTrump) June 30, 2018
Roughly an hour after Trump tweeted, the Associated Press reported that Saudi Arabia had confirmed the president and Salman talked about oil market “stability,” yet the country did not mention the 2,000,000 barrel mark set by Trump.
BREAKING: Saudi Arabia says Trump, King Salman talk about oil market ‘stability’; no mention of 2 million barrels from Trump tweet.
— AP Politics (@AP_Politics) June 30, 2018
Ilan Goldenberg, the Middle East Security Director at the Center for a New American Security, criticized the president for not carrying out oil stability talks with Saudi Arabia until after re-raising economic sanctions against Iran.
Probably something you may have thought of working out BEFORE you walked away from the nuclear deal & claimed that all Iranian oil sales must stop by November. https://t.co/dGBDIzr1MI
— Ilan Goldenberg (@ilangoldenberg) June 30, 2018
In addition to economic sanctions, Trump’s anti-Iran campaign has been buttressed by Israeli Prime Minister Benjamin Netanyahu’s recent, not-so-veiled appeals to the “brilliant” Iranian people to protest and cause political insecurity for Iranian President Hassan Rouhani.
“Iran’s dictators plunder the country’s wealth,” he said in a video address to Iranians. “Isn’t it a shame that Iran doesn’t invest in its people? Instead they divert tens of billions of dollars into their nuclear program, to the spread terror across the world, to their aggression throughout the Middle East. The Iranian people are the ones that suffer.”
Last week, OPEC announced it would be increasing the number of barrels produced per day by 600,000 barrels to try and stymie rising oil prices, yet speculation that Iran could reportedly pull back production even further has kept prices volatile.
Sen. Heidi Heitkamp, D-.N.D, also reportedly broached the subject while meeting with the president on Thursday to discuss his possible Supreme Court nominees.
Heitkamp raised concerns about oil prices’ effects on shale oil, which needs a roughly $30 per barrel price of oil to remain competitive in the energy industry. Currently, oil prices are fluctuating between $65-73.
Domestic producers are additionally concerned that the president’s tariffs on steel and aluminum will dramatically increase the costs of oil pipeline infrastructure. Trump reportedly also plans to increase taxes on most U.S. commodities, including oil and natural gas, which could make U.S. energy exports less competitive.
