President Donald Trump is rooting for oil prices to fall even further after a stunning plunge over the last seven weeks. The U.S. oil and gas industry, a pillar of Trump’s political base, is likely less enthusiastic.
@realDonaldTrump: Oil prices getting lower. Great! Like a big Tax Cut for America and the World. Enjoy! $54, was just $82. Thank you to Saudi Arabia, but let’s go lower!
Trump sent the tweet one day after he declared his support for Saudi Arabia, shrugging off bipartisan calls to punish the kingdom after Saudi agents murdered journalist and U.S. resident Jamal Khashoggi last month. The CIA has reportedly concluded Saudi Crown Prince Mohammed bin Salman ordered the killing, but Trump has been casting doubt on that assessment throughout the week.
The president’s defense of Saudi Arabia comes about two weeks before a critical OPEC meeting on Dec. 6. Trump wants the Saudi-led group to keep pumping at full tilt, which would keep a lid on oil prices.
In recent weeks, the 15-nation OPEC cartel and several other exporters have signaled that they will agree to a price-boosting output cut. But Trump’s overtures to the Saudis could make it more difficult for the kingdom to support throttling back output.
“It looks like they’re going to be backing off on that,” John Kilduff, founding partner at energy hedge fund Again Capital, told CNBC’s “Squawk Box” on Wednesday. “Our relationship with them appears to be bought and paid for now, and the oil market’s MVP, President Trump, is helping to keep a lid on prices.”