Iranian Officials Speak Out Against Too-High Oil Prices

Oil prices have been on a tear over the past 12 months, rising more than 65 per cent from its US$42.50 per barrel low in June 2017 to recently breaching the US$70 per barrel level to start the week.

Oil prices rose to their highest levels since late 2014 on Monday, boosted by the latest troubles for Venezuelan oil company PDVSA and a looming decision on whether the United States will re-impose sanctions on Iran.

US President Donald Trump has consistently called the Iran deal "horrible".

Crude oil prices continue to rise today - both Brent and WTI are now registering gains.

President Trump has until May 12 to decide whether to pull the United States out of a 2015 global accord to curb Iran's nuclear program and restore sanctions on one of the world's biggest oil producers. Member nations of OPEC and Russian Federation earlier engineered a large output cut lead by Saudi Arabia, which is seeking to push oil prices up to $80 a barrel to help fund its planned economic overhaul.

Analysts warned that the deepening economic crisis in major oil exporter, Venezuela, threatened to further crimp its production and exports. "The continuously declining inventory has taken any cushion out of the global oil market", said Goehring, "If the inventory draws down any further, it will have a high-level impact on the price". "Iran's oil exports could credibly be curtailed by 200,000 barrels per day to 300,000 barrels per day", RBC Capital Markets analyst Helima Croft said in a note.

Venezuela's output has halved since the early 2000s to 1.5 million barrels per day, as the South American country has failed to invest enough in its oil industry. Recent price action suggests that investors have not yet concluded pricing in further risk premium as we edge closer to the May 12th deadline Trump has set himself to decide whether the U.S. will remain in the 2015 Iran nuclear deal, and any comments Trump makes in the lead up to the event have the potential to encourage fireworks in the oil markets.

On Monday, Saudi Arabian Energy Minister Khalid al-Falih said he is concerned about low oil industry investment and potential shortages in the future.But U.S. output has soared by more than a quarter in the last two years, to 10.62 million bpd. It is being reported by Bloomberg that Saudi Arabia's former price doves on oil now want prices near $80 a barrel and former Price hawk Iran want staple prices in the $60 a barrel range.

Global oil demand expanded by 1.5 million barrels per day past year, thanks to a rebound in US gasoline demand from drivers of SUVs and light trucks. Some traders, however, are becoming cautious about ever higher oil prices.

Only Russia now produces more, at around 11 million bpd.

USA drillers added nine oil rigs in the week to May 4, bringing the total count to 834, the highest number since March 2015, General Electric (NYSE:GE)'s Baker Hughes energy services firm said in its closely followed report on Friday.