Trump renews attack on OPEC ahead of group's production meeting

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The recent spike in oil should ease in the near term, according to the International Energy Agency's (IEA) latest monthly report, but there could be a large supply gap late next year if the Organization of Petroleum Exporting Countries (OPEC), year as oil demand will grow steadily thanks to a solid global economy.

Pumped further by global trade war fears, oil prices have since surged to multi-year highs, only to then fall back again somewhat, the IEA said.

Since early in 2017, however, OPEC has coordinated with Russian Federation, another oil-exporting country that is not an OPEC member, to try to regulate global supplies. US light crude was up 10 cents at $66.46 a barrel.

Although Saudi Arabia has benefited from oil's rally over the last two years, the government relies on a strong security relationship with the US, giving Washington some influence in the debate over OPEC policy.

Futures in NY dropped as much as 1.3 percent after Russian Federation, which has already started increasing output, was said to suggest that OPEC and its allies be allowed to return production to October 2016 levels within three months, although not all nations would be able to do so. The Kingdom self-reported a production increase of 161,400 bpd to 10.030 million bpd, just below its ceiling of 10.058 million bpd.

Traders are holding their breath for the June 22 meeting of oil ministers from Opec member states in Vienna. Prices have risen around 60 per cent over the past year.

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OPEC's crude oil production increased by 35,400 bpd from April, to 31.869 million bpd in May, as Saudi Arabia, Algeria, and Iraq boosted production that was partially offset by lower production in Nigeria, Venezuela, and Libya.

"More oil from OPEC plus is the base case", said Bjarne Schieldrop, analyst at Swedish bank SEB.

Saudi Arabia, the biggest producer, raised its production by 85,500 bpd to 9.987 million bpd, according to OPEC's secondary sources. "Unofficial sources have said Russian Federation will propose to return production back to the October 2016 (level), i.e. removing the cap altogether over a period of three months".

Rising US stocks are in part a result of the surge in US crude oil production, which has jumped by nearly a third in the last two years to a record 10.8 million barrels per day (bpd).

"Prices will be above $150 in less than two years", he tweeted on Wednesday.

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