The US president has once again made move to drive down the oil price which some say relates to the upcoming congressional elections in America in November but some say the latest effort will be in vain.
In a tweet yesterday Donald Trump lashed out at the Oil cartel Opec and warned them to reduce prices while at the same time threatening that the US was the savior of the middle east and could not guarantee the safety of the region if there were no attempts to reduce prices.
“We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices!” Mr. Trump said via his favourite social media site Twitter.
“We will remember. The OPEC monopoly must get prices down now!” he added.
The reason behind Trumps tweet may be the current prices of gasoline in the US which are currently on the high side and are a sensitive political issue and may be a factor in November’s elections and go a long way to deciding the outcome.
The question is now will Trump follow up with more threats and are they going to be effective in helping drive the prices lower.
According to some analysts, Trump may be able to drive prices lower with his rhetoric in the short term but the fundamentals in place will ensure a quick rebound.
It seems Ironic that the US is calling for lower oil prices when they are in fact the one’s who drove prices higher with the introduction of sanctions against Iran
“The question is, will this reverse market sentiment?” said Peter Cardillo, chief market economist at Spartan Capital Securities.
“We don’t think so. It may lean on prices for a brief period of time, but the fundamentals and the Iranian situation are behind a solid run up.” He added.