UPDATE 13-Oil posts biggest one-day gains after Trump touts Saudi-Russia oil deal

Reuters

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    * Brent and WTI post record daily percentage gains
    * Brent rises 47% in intraday trade
    * Trump says he expects Saudi Arabia-Russia deal soon

 (Adds closing prices)
    By Scott DiSavino
    NEW YORK, April 2 (Reuters) - Crude prices posted their
biggest-one day gains on record on Thursday after President
Donald Trump said he expects Russia and Saudi Arabia to announce
a major oil production cut, and Saudi state media said the
kingdom was calling an emergency meeting of producers to deal
with the market turmoil. 
    Trump said he had spoken to Saudi Crown Prince Mohammed bin
Salman, and expects Saudi Arabia and Russia to cut oil output by
as much as 10 million to 15 million barrels, as the two
countries signaled willingness to make a deal.  urn:newsml:reuters.com:*:nW1N2AP01S
 urn:newsml:reuters.com:*:nL8N2BQ36Q  urn:newsml:reuters.com:*:nL1N2BQ1BF 
    Trump did not specify barrels per day (bpd), though the
market expresses demand and supply in those terms. Such a
sizeable deal, however, would likely require participation from
other big producers outside of the OPEC cartel.
    Saudi Arabia said it would call an emergency meeting of the
Organization of the Petroleum Exporting Countries (OPEC), Saudi
state media reported. The Wall Street Journal reported that the
kingdom would consider dropping output to roughly 9 million bpd,
or about 3 million bpd less than what it planned on pumping in
April.
    Brent futures  LCOc1  rose $5.20, or 21.0%, to settle at
$29.94 a barrel, while U.S. West Texas Intermediate (WTI) crude
 CLc1  rose $5.01, or 24.7%, to settle at $25.32.
    Despite the huge gains, oil prices have still lost more than
half their value this year. The market slumped in early March,
when Saudi Arabia and Russia were unable to come to terms on a
deal to curb production, and the Saudis boosted output to more
than 12 million bpd and shipped discounted cargoes worldwide.
    Since then, the coronavirus pandemic has severely cut fuel
demand. U.S. crude prices fell under $20 per barrel a few times
in recent days.
    "The question will come down to, Will they be able to agree
to something? It's taken a couple of weeks of Brent at $25 and
WTI at $20 and it seems as if the Russians are more approachable
than they were a month ago," said Gene McGillian, vice president
of market research at Tradition Energy in Stamford, Connecticut.
    Brent soared as much as 47% during the session, its highest
intraday percentage gain ever. WTI jumped as much as 35%, its
second highest ever, after an intraday gain of 36% on March 19.
    Oil prices pulled back from those highs as traders
questioned whether Russia and Saudi Arabia could actually agree
on such a big production cut. 
    A senior administration official told Reuters the United
States does not know formal details of Saudi Arabian and Russian
plans to reduce oil supply yet and will not ask U.S. domestic
oil producers to chip in with their own cuts.  urn:newsml:reuters.com:*:nL1N2BQ1MS
    "Despite today’s headlines, we remain skeptical that a deal
to cut output will materialize," analysts at Capital Economics
said, noting Saudi Arabia is unlikely to cut output unless
Russia and possibly other non-OPEC producers, like the United
States and Canada, join in a coordinated reduction.
    With fuel demand expected to fall by 20% to 30% in coming
months, pressure was building on oil producers to reach a deal,
and Trump expressed growing frustration about the crude price
and its effect on the energy industry. 
    Texas regulators are exploring the possibility of cutting
production in that state, which produces more than 5 million
bpd.

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GRAPHIC: Oil price plummets     https://graphics.reuters.com/USA-OIL/0100B5LV472/index.html
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 (Reporting by Scott DiSavino in New York; Additional reporting
by Laila Kearney, Devika Krishna Kumar and Jessica Resnick-Ault
in New York, Liz Hampton in Houston, Julia Payne in London, Shu
Zhang in Singapore and Sonali Paul in Melbourne; Editing by
David Gregorio and Leslie Adler)
 ((scott.disavino@thomsonreuters.com; +1 646 223-6072; Reuters
Messaging: scott.disavino.thomsonreuters.com@reuters.net))

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