Trump: Saudi Arabia, Russia near deal to end oil price war, markets respond with gains

President Trump said Thursday that Saudi Arabia and Russia are close to an agreement that will eliminate millions of barrels of oil from for sale on global markets – ending a price war between the countries that has contributed to record losses in the financial markets.

In early March, Saudi Arabia, part of the Organization of the Petroleum Exporting Countries, said it would slash oil prices after non-OPEC member Russia wouldn’t agree to cutting back on its oil production to stabilize prices, amid a drop in demand as a result of the coronavirus outbreak.

Oil prices soared Thursday afternoon, by nearly 50 percent, following Trump's tweet.

“Just spoke to my friend MBS (Crown Prince) of Saudi Arabia, who spoke with President Putin of Russia, & I expect & hope that they will be cutting back approximately 10 Million Barrels, and maybe substantially more which, if it happens, will be GREAT for the oil & gas industry!” Trump said over two tweets. “Could be as high as 15 Million Barrels. Good (GREAT) news for everyone!”

Trump was referring in the tweet to Crown Prince Mohammed bin Salman of Saudi Arabia and Russian President Vladimir Putin.

The 10 to 15 million barrels to which Trump was referring is a per-day number. The world oil demand last year was about 100 million barrels a day.