Trump says Saudi king agrees to ramp up oil production

Mr Trump said he received assurances that Saudi Arabia will increase oil production

Mr Trump said he received assurances that Saudi Arabia will increase oil production

However, Riyadh did not reference anything related to a two-million-barrel increase, leading to questions about whether Trump's tweet was an exaggeration, wishful thinking, a business strategy, or yet another "Trumpism".

Iran opposed any changes to the original production-cut deal at a time when its oil industry is facing renewed sanctions over Trump's decision to quit the global nuclear deal with Tehran. Since then, the two governments have announced hundreds of billions of dollars worth of contracts, with Trump openly bragging about how many United States jobs the Saudis were helping to create.

If the Saudis had agreed to Trump's request, "that means he is calling on them to walk out from OPEC", Iran's OPEC governor Hossein Kazempour Ardebili, said in an interview.

The development comes days after Saudi Arabia, the world's biggest oil exporter, agreed to go all in with production.

OPEC agreed with Russian Federation and other oil-producing allies on June 23 to raise output from July, with Saudi Arabia pledging a "measurable" supply boost, but giving no specific numbers. It produces around 10 million barrels of crude per day, according to OPEC. It closed Friday at $79.44. Average prices for unleaded gas, including taxes, averaged $2.83 a gallon for the week ending June 25 - up about 55 cents over the same period a year ago.

Trump has recently taken to Twitter several times in recent months to criticise OPEC for failing to raise output. They now have the flexibility to respond to disruptions and moderate prices at a time when United States sanctions on Iran and Venezuela threaten to throw the oil market into turmoil. Growing concerns over US' relations with major oil producers like Iran and Venezuela is threatening the market. "It's certainly easy to imagine a scenario at this point where oil prices hit $100 again this year", said Jason Bordoff, director of the Center on Global Energy Policy at Columbia University.

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Cosmo Energy Holdings is also lifting 2 million barrels of US oil between April and July, according to shipping data and a source familiar with the matter.

"In this case, Saudi Arabia's output [with two million bpd spare capacity] needs to increase by at least 400,000 bpd in the second half of 2018 to offset the supply shortfall and lead to a marginal increase in global inventory levels. He has agreed! (sic)", Trump tweeted.

"Any unilateral production increase beyond member countries' commitments under the OPEC's decisions would prompt U.S.to take actions against Iran", he wrote.

However, the recovery in momentum was gradual as the reduction in supplies due to OPEC led voluntary cut and unplanned supply disruption from Canada, Libya and Venezuela were virtually balanced by high USA shale output.

Meanwhile there has been growing civil unrest in Venezuela amid an ongoing economic crisis.

Crude oil's gains have been buoyed by a dispute in Libya over oil-marketing rights that is restricting the country's export capacity.

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