Oil leaps on positive murmurings by Donald Trump

London — Crude oil futures jumped 10% on Thursday after US President Donald Trump said he expected Saudi Arabia and Russia to reach a deal soon to end their oil price war.

Brent crude futures rose more than 11% in early trade. By 9.58am, Brent was up 8.97%, or $2.22, to $26.96, while US West Texas Intermediate (WTI) crude futures rose 8.81% or $1.79, to $22.10.

Trump said he had talked recently to the leaders of both Russia and Saudi Arabia and believed the two countries would make a deal to end their price war within a “few days” — lowering production and bringing prices back up.

Trump also said he had invited US oil executives to the White House to discuss ways to help the industry “ravaged” by slumping energy demand during the coronavirus outbreak and the Saudi Arabia/Russia price war.

“Oil prices are seeing their biggest gains in two weeks this morning … There are two key factors … both of which, however, are not enough to save oil prices from further declines,” Rystad’s head of oil markets Bjornar Tonhaugen said in a daily note.

“The first, US oil diplomacy efforts towards Saudi Arabia and Russia … The second big news driving the positive sentiment was rumours that China will speed-up its crude purchases for their strategic stockpiles.”

Speaking at a government meeting on Wednesday, Putin said that both oil producers and consumers should find a solution that would improve the “challenging” situation of global oil markets.

Saudi Arabia supports co-operation between oil producers to stabilise the market but Russia’s opposition to a proposal last month to deepen supply cuts has caused market turmoil, a senior Gulf source familiar with Saudi thinking told Reuters.

Some analysts said there was still a long way to go before any output cut agreement is struck.