Saudi Arabia, Russia to cut crude production says Trump; oil prices bloom

sun shined over oil prices on Thursday after US President Donald Trump said top oil exporters Saudi Arabia and Russia have agreed to slash crude production substantially, which was followed by Saudis calling for an urgent OPEC+ meeting. International benchmark Brent Crude shot up nearly 22% within half an hour of Trump’s revelation, which was me over Twitter.

Brent crude soared to over $32 a barrel following Trump's tweet, before easing to $29. American benchmark West Texas Intermediate (WTI) shot up to $27 (+25%) a barrel before falling back to $24.

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Trump's relieving tweet

President Donald Trump in a tweet said that he spoke to Saudi Arabia's Crown Prince Mohamm bin Salman, who earlier spoke to Russian President Vlimir Putin, and he expects that two petroleum powerhouses will cut back crude production by "approximately 10 million barrels". He touted this as a "great" thing for US oil and gas industry. US has emerged as world's top oil producer and has turned into a net exporter.

Oil under stress

International crude oil prices have been suffering due to a demand plunge caused by coronavirus pandemic which has put nearly a third of mankind under lockdown and shattered ecomic activities. Also contributing to fall is a supply glut in oil market after OPEC's de facto leer Saudi Arabia wd a price war with n-OPEC Russia following collapse of a production cut deal earlier in March.

market is flooded with oil right w, with little signs of demand picking up. Oil importers like India have been benefitting with this slump as nation saves billions of dollars in import bill monthly.

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Saudi rey for OPEC+ meet

Following Donald Trump's tweet, Saudi Arabia confirmed that country will call an urgent meeting of OPEC+ (OPEC plus or producers like Russia) "with an aim to retrieve balance to oil markets". OPEC is a club of 14 oil-producers that includes countries like Iran, Iraq, Venezuela, among ors.

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