The oil supply shortage in the Mediterranean market, which will emerge once the USA sanctions targeting Iranian oil come into force on November 4, is predicted to direct the market toward Russian Ural oil, a case that will eventually lead to intensified sea traffic in Istanbul and the Çanakkale Straits.
In a desperate bid to avoid being blamed for $100 oil, Trump tried bullying OPEC producers to boost production levels to prevent further price hikes ahead of the USA mid-term elections in early November.
Iran's crude exports to China also increased by 29,000 bpd to 620,000 bpd, according to Kpler, as China cut its USA purchases amid an ongoing trade spat with the United States. Saudi Energy Minister Khalid al-Falih said on Thursday the Organization of the Petroleum Exporting Countries was able to raise output by 1.3 million barrel per day, but offered no signal that the producer group would do so. After the JCPOA and the European Union agreed to relieve sanctions imposed on Iran on the condition that the country curb its nuclear capacity in July 2015, Iran's crude exports saw a slight increase in 2016, reaching 1.9 million bpd and jumped to 2.1 million bpd in 2017, according to data compiled from OPEC.
That might not be enough to outweigh supply concerns but the scope for further strong price gains near-term seems limited.
A senior Iranian official says the recent rise in oil prices has offset the impact of United States sanctions on Iran's oil exports, with the country's oil revenues up 16 percent in the past six months.
Brent for December delivery was fetching around $85.30 per barrel in late London business versus $81.50 per barrel at the same time the previous week.
There was no immediate reaction Wednesday in Saudi Arabia to Trump's remarks. "We defend many of these nations for nothing, and then they take advantage of us by giving us high oil prices".
"We protect Saudi Arabia would you say they're rich?" However, the market has gone from strength to strength due to the expected severity of the Iran sanctions and output woes elsewhere, notably in Venezuela.
Russia and Saudi Arabia are pumping an extra million barrels of crude daily and the Russians could add another 200,000 to 300,000 barrels within a "few months", Energy Minister Alexander Novak said.
"We're just seeing a lot of fear about future supply", said Ashley Petersen, senior oil market analyst at Stratas Advisors LLC.
Russia's Novak was not alone in predicting a return to three-digit price levels last seen in 2014.