Trump will support Saudi Arabia amid fear of oil prices hike
Business, Energy

Trump will support Saudi Arabia amid fear of oil prices hike 

Last updated on December 3rd, 2018

President Donald Trump is keen on supporting Saudi Arabia in order to avoid oil prices hike. The decision came despite the murder of a U.S. resident by agents from Saudi Arabia.

Trump told the media on Tuesday, “Saudi Arabia, if we broke with them, I think your oil prices would go through the roof. I’ve kept them down. They’ve helped me keep them down.”

Earlier on Tuesday, a statement was released by Trump saying the United States stands by Saudi Arabia even after the kingdom was involved in the brutal murder of U.S. resident and journalist Jamal Khashoggi in a Saudi consulate in Istanbul, Turkey.

Reportedly, Crown Prince Mohammed bin Salman, a close ally of Trump’s son-in-law Jared Kushner, has been concluded by the CIA as the authorizing power behind the murder of Khashoggi on 2nd October. On Tuesday, Trump left a doubt on the conclusion, saying “maybe he did and maybe he didn’t!”

Trump has been supporting Saudi Arabia in order to generate more oil and maintain the prices low by convincing a group of producers to increase output. His declaration came just when the meeting of OPEC, Russia and other oil producers to discuss the whether to reverse course and cut production next year was around the corner.

Earlier this year, Trump dropped hints of restoring sanctions on OPEC’s third biggest oil producer Iran, leading to a price rise in the crude sector. Trump said Saudi Arabia played a crucial role in preventing oil prices hike, which could have gone above $100 a barrel.

“Right now we have oil prices in great shape. I’m not going to destroy the world economy, and I’m not going to destroy the economy for our country by being foolish with Saudi Arabia. I think the statement was pretty obvious what I said. It’s about America First,” Trump said.

In May, Trump withdrew from the 2015 Iran nuclear deal. Saudi Arabia, which is a prominent rival of Iran, backed Trump’s decision when the European U.S. allies did not support him.

U.S. sanctions on Iran’s banking, energy, and shipping sectors came into effect on November 5. Prior to the implementation of sanctions, the market prepared itself for a shortage of crude, in return, oil prices hiked, touching the highest in the last four years.

In order to prevent price-crushing oil supply, Saudi Arabia is considering cutting the output by 1 million to 1.4 million barrels per day. Recently, trump urged the Saudis and OPEC to not control back output via Twitter.

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