President Donald Trump’s withdrawal from the Iran nuclear deal is likely to exacerbate tensions between two of the world’s biggest oil producers at next month’s OPEC meeting, one analyst told CNBC Wednesday.
Global oil supplies were already tightening ahead of the U.S. president’s decision to pull out of the landmark nuclear accord on Tuesday, while crude futures have since soared to multi-year highs.
Yet, in a move that defied pleas from close allies, Trump said he would seek to re-impose economic sanctions on Tehran, elevating concerns about the future of the supply-cutting deal between OPEC members and allies including Russia.
“I think it is hard to believe that there won’t be some gamesmanship the next time that we gather in Vienna in June,” Andy Critchlow, head of EMEA energy content at S&P Global Platts, told CNBC Wednesday.
“Is it really in (Iran’s) interest now to sign up to a Saudi-led Russian deal to extend these cuts? Of course, the high oil price suits Saudi Arabia … But the Iranians can think ‘now we will play the long game’ and play hardball here,” he added.