Oil jumps 15% on expectations for large output cut from OPEC

Oil prices continued to surge as the US market opened on Friday, as the US crude jumped 15% and Brent jumped 17%, to extend gains for the second day near a 3-week high, on prospects for a deeper OPEC output cut agreement in the next emergency meeting of the OPEC-Plus coalition on Monday, and the Russian producers' confirmation of their readiness to cut output to stop the falling prices.

The US crude rose 15% to the highest level since March 17 of $28.54 a barrel, after opening at $24.83, and hit a day low of $23.55, and Brent rose 17.1% to $34.86, after it opened at $29.76, with a low of $28.28.

The US crude also rose 16.7% yesterday, its second daily gain, to continue its recovery from the 18-year low of $19.29, and Brent rose 16.1%, its second daily gain in three days within recovery attempts from the lowest since March 2002 at $21.68.

This came after the US crude jumped earlier yesterday by 29%, and hit its 2-week high of $27.32 a barrel, and Brent surged 41%, and its 3-week high of $36.16 a barrel.

But soon those record gains were trimmed, amid some doubts about Saudi Arabia and Russia agreeing on a deeper cut, in addition to President denying any US involvement in this agreement.

Saudi Arabia has called for an emergency meeting of the OPEC and non-OPEC producers led by Russia, known as OPEC-Plus, to discuss the oil market current condition, and stated it looks forward to a fair agreement that will balance the oil market.

The Kuwaiti Oil Minister Khalid al-Fadil expressed support to the Saudi call for an emergency OPEC-Plus meeting.

According to the official announcement, the meeting will be held at April 6, via a closed conference call.

Reuters quoted an informed source that the OPEC-Plus coalition is preparing a cut agreement that may surpass 10%, to prevent the falling prices due to the coronavirus pandemic.

The major Russian oil producers expressed readiness to cut output during a meeting with President Vladimir Putin today.

While President Donald Trump said yesterday that he had spoke to Saudi Crown Prince Muhammad bin Salman and discussed ways to balance the global energy market, adding that he expects Saudi Arabia and Russia to agree on cutting back about 10 to 15 million barrels per day, but he also excluded any participation of US shale oil producers in the agreement.

Trump will also meet later today with the CEOs of seven major working shale oil companies, during which they will discuss production policy, but sources said that the US president will not request production cuts for these producers.