Trump vs. OPEC: Decoding the president's oil diplomacy

World
Europe

02:16

This year, U.S. President Donald Trump has slammed, berated and warned OPEC, even accusing it of manipulating crude oil prices. So, what's the logic behind Trump's tirade against the oil producing cartel?

From the halls of the United Nations (UN) headquarters in September, Trump accused OPEC countries of cheating. He said OPEC and OPEC nations are as usual ripping off the rest of the world, and he doesn't like it. Nobody should like it.

For an entire year, the U.S. president has squarely blamed the organization for higher oil prices.

It all started on April 20 this year, when Trump tweeted a warning to OPEC that he would not tolerate the cartel's oil price manipulation.

Two months later, he targeted the bloc again, highlighting that U.S. crude had spiked above 70 U.S. dollars for the first time in four years.

While oil market experts blamed Trump's sanctions on Iran for the hike, the U.S. president continued to insist OPEC alone was at fault.

U.S. President Donald Trump accuses the OPEC of driving up oil prices. /VCG Photo

The same month he dialed Saudi Arabian King Salman and asked the country to ramp up production. But prices kept rising.

So, over the course of four months, on multiple occasions, Trump has attacked OPEC policies. Yet analysts continued to cite the U.S. president's sanctions against OPEC's third biggest producer Iran.

In November, when oil prices crashed to around 60 U.S. dollars per barrel, he issued another warning.

A week later, oil fell below 55 U.S. dollars, and Trump thanked Saudi Arabia on Twitter.

A day earlier, he had controversially announced he would stand by the kingdom on the journalist Jamal Khashoggi murder case with claims that he was using it as a "leveraging tool" to keep oil prices down.

Increased production of crude in the U.S. is also one of the major factors behind an oil market downturn. For the first time on record, the United States last week exported more crude oil and fuel than it imported.

Political analysts say Trump's fear of a potential backlash at home is the driving force behind his OPEC tirade. They argue that higher gasoline prices in the U.S. would not auger well politically for his 2020 re-election bid.

As OPEC debates whether to cut output, the U.S. president is keeping a close watch. The question is, how long will the oil cartel toe the Trump line?