Foreign ministers from the five remaining signatories of a nuclear deal between Tehran and world powers will meet Iranian officials in Vienna to discuss how to keep the accord alive after the US withdrawal from the pact.
The cartel, in partnership with Russian Federation, has restricted oil supply for over a year to support the price per barrel after a period of sharp decline from recent highs, which caused economic turmoil for member states.
Saudi Arabia's state-run oil giant cut its prices Thursday for first time since February after President Donald Trump lashed out at the OPEC cartel of oil producers over rising USA gas prices.
The oil market has been supported by a fall in output from Venezuela and the potential for a halt of Iranian oil exports due to US sanctions.
OPEC and partners agreed on June 23 to increase oil production, with the Saudi and Russian energy ministers saying it would add about 1 million barrels a day to the market.
Production at Syncrude Canada's 360,000 barrels per day (bpd) oil sands facility near Fort McMurray, Alberta, was hit by a power outage last month and is likely to remain offline through July, helping drain US inventories.
Also, President Trump once again took to Twitter to call out the Organization of Petroleum Exporting Countries (OPEC) for the high oil prices. West Texas Intermediate, the US benchmark for the price of oil, was up 1.51 percent to $75.06 per barrel, its highest level since November 2014. That may reduce the pressure on Saudi Arabia to keep oil prices high, said John Kilduff, partner at energy hedge fund Again Capital LLC in NY.
"If Trump continues to believe that OPEC are not doing enough, we would not rule out an SPR (Strategic Petroleum Reserve) release from the USA, or possibly even export restrictions on petroleum products", ING said in a note.
More so, expectations of a drop in the U.S. crude stockpiles due to be published by the EIA later on Thursday, following the bullish API crude inventories report, helps underpin the sentiment around the barrel of WTI. The price of diesel fuel used largely by truckers was $3.17 a gallon, up 30 percent from a year ago, AAA said.
"If they want to stop Iranian oil exports, we will not allow any oil shipment to pass through the Strait of Hormuz", Ismail Kowsari, an Iranian Revolutionary Guards commander, told Iran's Young Journalists Club, Reuters reported.