Price of Brent crude oil climbed above $30 per barrel after U.S. President Donald Trump announced Thursday he spoke with Saudi and Russian leaders, and expects them to lower their oil production levels substantially.
The international benchmark climbed to as high as $30.86 per barrel at 1436 GMT on Thursday for a 38.5% daily increase after it closed Wednesday at $22.27 a barrel. The benchmark retreated to $25.91 a barrel at 1544 GMT when its daily gain was 16.3%.
American benchmark West Texas Intermediate (WTI) jumped to $26.94 per barrel at 1443 GMT for a daily gain of 28.16% after it ended Wednesday at $21.02 a barrel. In the following minutes, WTI fell to $24.51 per barrel at 1546 GMT when its daily gain was 16.6%.
President Trump said he spoke with his "friend" Saudi Crown Prince Mohammad Bin Salman in a bid to have the Kingdom and Russia lower oil production as prices continue to sit near record lows.
"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 on Twitter.
Trump said in a follow-up tweet that the production cuts of Russia and Saudi Arabia could hit 15 million barrels, which he said would be "Good (GREAT) news for everyone!"
Oil prices had started to decline after Saudi Arabia and Russia locked in a war regarding production, with both nations ramping up output after a pact between the Saudi-led Organization of the Petroleum Exporting Countries (OPEC) and Russia expired.
During the OPEC+ conference in Vienna, Austria on March 6, Saudi Arabia and Russia failed to make deeper cuts into the group's oil production levels to mitigate the adverse impact of coronavirus on weakening global oil demand.
After the conference both countries announced the following week that they would boost up their crude oil output starting from April, triggering a war for greater market share.
On March 30, Brent crude plummeted to $21.67 per barrel and WTI fell to $19.04 a barrel to mark their lowest levels since 2002 due to coronavirus-related weak economic activity and low oil demand around the world, coupled with OPEC+ countries failing to make deeper and longer cuts into their oil production levels.
- Kremlin spokesperson refutes Trump's tweet
Meanwhile, the Kremlin spokesman Dmitry Peskov refuted Trump's claim that the Russian President Vladimir Putin and the Saudi Crown Prince Mohammad Bin Salman discussed the oil markets.
"No, no such talk happened between the two sides," Peskov said in a statement to Russian news agency RIA Novosti soon after the Trump's tweets.
Peskov had already announced Thursday that there would be no discussion with the Saudi administration in Putin's agenda.
Additionally, Saudi Arabia's news agency SPA reported that the the Kingdom called for an urgent meeting between OPEC and OPEC+ countries led by Russia to create "a fair agreement" to stabilize the oil markets.
The Kingdom seeks a meeting to support the global economy under the extraordinary conditions and in the consequence of President Trump's request to balance the markets.
By Nuran Erkul Kaya & Ovunc Kutlu