By Florence Tan
SINGAPORE (Reuters) – Oil prices fell more than 1% on Monday after U.S. President Trump called on OPEC to cut prices following sweeping measures to boost U.S. oil and oil supplies in his first week in office announced gas production.
Futures fell 87 cents, or 1.11%, to $77.63 a barrel by 0043 GMT, after rising 21 cents on Friday.
U.S. West Texas Intermediate crude settled at $73.77 a barrel, down 89 cents, or 1.19%.
Trump on Friday reiterated his call for the Organization of the Petroleum Exporting Countries to cut oil prices to hurt oil-rich Russia’s finances and help end the war in Ukraine.
“One way to stop it quickly is for OPEC to stop making so much money and lower the price of oil… This war will stop immediately,” Trump said.
Trump has also threatened to hit Russia “and other participating countries” with taxes, tariffs and sanctions if an agreement to end the war in Ukraine is not reached soon.
Russian President Vladimir Putin said Friday he and Trump should meet to discuss the Ukraine war and energy prices.
However, OPEC and its allies, including Russia, have not yet responded to Trump’s call, with OPEC+ delegates pointing to an existing plan to begin increasing oil production from April.
Both benchmarks posted their first declines in five weeks last week as fears eased that sanctions against Russia could disrupt supplies.
Goldman Sachs analysts said they do not expect a major impact on Russian production as higher freight rates have incentivized a higher supply of unsanctioned vessels to transport Russian oil, while extending the rebate to the affected Russian ESPO – Variety attracts price-conscious buyers to keep purchasing the oil.
“Since the ultimate goal of sanctions is to reduce Russian oil revenues, we expect Western policymakers will prioritize maximizing discounts on Russian barrels over reducing Russian volumes,” the analysts said in a note.
Still, analysts at JP Morgan believe some risk premium is warranted, given that nearly 20% of Aframax’s global fleet is currently sanctioned.
“Using sanctions against the Russian energy sector as leverage in future negotiations could go either way, suggesting that a zero risk premium is not appropriate,” they added in a note.
More trade disruptions are expected after Trump announced Sunday that he would impose sweeping retaliatory measures against Colombia, including tariffs and sanctions, after the country turned away two U.S. military planes carrying deported migrants.
The U.S. is the largest buyer of Colombia’s seaborne crude oil exports, accounting for 183,000 barrels per day (bpd) in 2024, accounting for 41% of Colombia’s total exports, data from analytics firm Kpler showed.
Energy Information Administration data showed the U.S. imported 228,000 barrels a day of crude oil and products from Colombia in 2023.
