US President Donald Trump has taken another hit at the Organization of the Petroleum Exporting Countries (OPEC). He has demanded that member states should contribute substantially for military protection provided by the US.
Trumps comments at the UN General Assembly come as oil hit a four-year high of $82 per barrel on Tuesday. Earlier, he repeatedly accused OPEC of "pushing for higher" crude prices despite the military protection provided by the US. The US president is against high oil prices, since they result in higher gasoline prices in America.
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Speaking on Tuesday, Trump said that OPEC members were “as usual ripping off the rest of the world.”
“I dont like it and nobody should like it. We defend many of these nations for nothing and then they take advantage of us by giving us high oil prices… We want them to start lowering prices… we are not going to put up with it, these horrible prices, much longer,” he said.
"We defend many of these nations for nothing, and then they take advantage of us by giving us high oil prices. Not good."
OPEC, Russia and other producers refused to raise oil output last weekend despite Trumps demands. Oil supply has been falling as countries are reducing purchases from Iran, whose oil sector will be sanctioned by the US from November 4. The International Energy Agency predicts strong oil-demand growth of 1.4 million barrels per day (bpd) this year and 1.5 million bpd in 2019. Rising demand and plunging supply have resulted in a spike in oil prices.
The average cost of gasoline in the US has risen 60 percent from $1.87 per gallon in February 2016 to over $3 in September. With US midterm congressional elections in 2018 coming up, high gasoline prices could hurt the Republican Party in swing states, John Kemp, a Reuters market analyst noted earlier.
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