July 1, 2018 / 11:12 PM / 17 days ago

Oil falls as White House says Saudi king to raise output if needed

TOKYO, July 2 (Reuters) - Oil prices fell early on Monday, following comments from the White House that the leader of Saudi Arabia promised President Donald Trump that he can raise oil production if needed.

U.S. West Texas Intermediate crude for August delivery was down 65 cents, or 0.9 percent, at $73.50 a barrel by 2250 GMT, after rising more than 8 percent last week. It touched a low of $72.51.

The contract on Friday touched a high of $74.46, which was the highest since November 2014, rallying on concerns that U.S. sanctions against Iran would remove a substantial volume of crude oil from world markets at a time of rising global demand.

London Brent crude fell 55 cents, or 0.7 percent, to $78.68, after gaining more than 5 percent last week.

The leader of Saudi Arabia promised President Donald Trump that he can raise oil production if needed and the country has 2 million barrels per day of spare capacity, the White House said on Saturday, rowing back on an earlier Trump tweet that appeared to suggest the Saudis had agreed to boost output by that amount.

Trump told King Salman bin Abdulaziz Al Saud that the oil market could need more supply when the men spoke on Friday, the White House said. The Saudi leader said he was ready to raise output if needed, the White House said in a statement.

President Trump lashed out at OPEC with a warning to stop manipulating oil markets and piled pressure on close U.S. allies in an interview that aired on Sunday with a threat to sanction European companies that do business with Iran.

Reporting by Osamu Tsukimori; editing by Richard Pullin

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