Russian President Vladimir Putin has said that US President Donald Trump’s policies towards top oil producers such as Venezuela and Iran are a primary cause of heightened oil prices, during a speech at Russian Energy Week.

Putin said: “President Trump has said he thinks the oil price is too high. Well, probably to some extent he’s right, but we are absolutely OK with it at $65 to $75 per barrel to ensure the efficient operation of oil companies and ensure investment.

“But let’s be frank, such oil prices are to some extent the result of the US administration. I’m talking about sanctions against Iran, about political problems in Venezuela and just looking at what’s happening in Libya.”

The accusations came in response to Trump’s criticism of the Organization of the Petroleum Exporting Countries (OPEC) over a collective decision made in 2016 to restrict oil output to help the industry recover after prices slumped due to excess oil supply two years earlier.

Putin defended OPEC’s actions at Russian Energy Week, saying it was an attempt to balance the market.

“As for the reduction of production and keeping it quite low, this is just a tool, this is not our goal. Our goal is to balance the market, when we along with our colleagues from OPEC agreed to cut production this is what we talked about, cutting excessive stocks… This is not about the income of oil companies,” Putin said.

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By GlobalData

“If the market is not balanced, there is a situation which leads to reduced investment and finally this will create a deficit on the market and prices will leap.”

Russian Energy Week is an annual energy conference held in Moscow, and discusses industry developments in oil, gas, coal, petrochemistry, electricity and energy conservation.

‘Talk of $100 per barrel’

Brent crude futures prices have climbed to $84.98 per barrel today, and according to analysts, this upward trend could continue.

PVM Oil Associates oil analyst Stephen Brennock said in a research note last week: “Even against this backdrop of a firmer dollar and potential demand destruction, talk of $100 a barrel is rife.

“While we see such predictions as premature, one thing is clear – the ascent in oil prices shows few signs of capitulating.”

Trump has pledged to restrict Iran’s oil exports by placing sanctions on countries that import from the Middle Eastern nation and has also threatened Venezuela with oil sanctions in an effort to undermine President Nicolás Maduro.

US interventions under former president Barack Obama in Libya in 2011 and the resulting civil war have curbed Libyan oil production as well. In all, US foreign policy has compelled OPEC to push production to its limits.

In response, Trump has assured that Saudi Arabia can replace Iran’s supplies, but according to analysts this will only be possible if and when the Saudi kingdom can build the adequate infrastructure to support the claim.

RBC Capital Market global head of commodity Helima Croft told NBC last May: “If you reach infrastructure constraints in terms of ability to put additional barrels on the market and you’re going to be taking off Iranian barrels — and don’t forget Venezuelan production, which has played a huge role in balancing this market — and they (OPEC) could lose a million barrels year-on-year.

“So, in order to prevent a spike to $100, potentially, you have to go back to Saudi Arabia, you have to ask them to put barrels on the market.”