Fatal floor

2 April 2020 By George Hay Follow @gfhay

A day before meeting with beleaguered U.S. crude-industry execs, the American president predicted an epic supply cut by Saudi Arabia and Russia. Yet he may only need a chunk of the 10 mln barrels a day reduction he’s hoping for to keep the U.S. shale industry from total collapse.

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U.S. President Donald Trump on April 2 said he had spoken to Saudi Crown Prince Mohammed bin Salman and expects Saudi Arabia and Russia to cut oil output by 10 million to 15 million barrels per day, as the two countries signaled a willingness to make a deal.

The Kremlin said on April 1 that Russian President Vladimir Putin had no immediate plans to have a phone call with the Saudi leadership about the oil market, but that such talks could be set up quickly if necessary. On April 2, Kremlin spokesman Dmitry Peskov said Russia’s president had not spoken to the crown prince, contradicting Trump's tweet.

The Organization of the Petroleum Exporting Countries’ de-facto leader Saudi Arabia called on April 2 for an emergency meeting of OPEC and non-OPEC oil producers, saying it aimed to reach a fair agreement to stabilise oil markets.

It was not clear when any such meeting could be held.

"This invitation comes within the framework of the kingdom's constant efforts to support the global economy in this exceptional circumstance, and in appreciation of the U.S. president's request and the U.S. friends' request,” the state news agency SPA reported.

As of 1723 GMT, Brent crude futures were trading at $30.50 a barrel, up 23.5%. West Texas Intermediate was trading at $25.30 a barrel, up 24.7%.

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