Crude Oil Explodes More Than 35% Higher On Trump Comments

WTI crude oil rocketed past $27 a barrel after plunging below $20 recently, on news that Saudis and Russia will mitigate pressure on oil, terminating a price war that has contributed to crude’s incredible crash.

West Texas Intermediate crude futures surged more than 35% or $7 a barrel and are still up 22%, or $4.51 to trade at $24.82 per barrel. International benchmark Brent crude popped 18%, or $4.56, to trade at $29.30 per barrel.

President Trump told CNBC’s Joe Kernen Thursday that he spoke to President Putin yesterday and Saudi Crown Prince Thursday and anticipates they will slash oil production by 10 million barrels, but that number could be as high as 15 million.

The president later tweeted that a production cut would be “great for the oil & gas industry!” His comments came before a meeting with energy industry executives scheduled for Friday and sent oil markets and ETFs soaring higher.


Rocketing crude oil futures sent crude ETFs higher as well, with the United States Oil Fund LP (USO) blasting up 17%, while leveraged fund, ProShares Ultra Bloomberg Crude Oil (UCO) is up a staggering 37%.

Until now, crude oil had continued its barreling downdraft as Saudi Arabia was not backing down from the oil price war with Russia for market share, threatening another increase in its crude oil exports beginning in May, despite a growing global glut amid crashing demand.

“[T]he Kingdom intends to increase its crude oil exports, starting from May, by about 600 thousand barrels per day, bringing the total of Saudi petroleum exports to 10.6 million barrels per day,” an official at the Saudi Arabian Energy Ministry said on Monday, as carried by the official Saudi Press Agency.

“This increase came as a result of displacing crude with natural gas from the Al-Fadhili gas plant, as a fuel for generating electricity, and from the decrease in local demand for petroleum products due to the decrease in transportation from the precautionary measures in place to limit the coronavirus outbreak,” said Saudi Arabia, OPEC’s top producer, and the world’s top oil exporter, which continues to signal an aggressive supply surge amid profoundly depressed global demand.

Earlier last month, the Kingdom said it was planning on releasing the expansion of crude oil volumes on the market, targeting a boost of its crude oil exports to more than 10 million BPD in May, which would set new records.

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