Oil prices have risen by 10% after US President Donald Trump said he expects Saudi Arabia and Russia to reach a deal to end their price war soon.
According to Reuters, Brent crude futures rose by 8.97%, or $2.22, to $26.96 a barrel at 09:58 UTC. Earlier in the week, the value dropped to $21.65, its lowest point since 2002.
Meanwhile, US West Texas Intermediate (WTI) crude increased by 8.81% or $1.79, to $22.10 a barrel.
After recent talks with Russia and Saudi Arabia, Trump said he expects the two countries to make a deal to end their price war in the next few days. This would lower production, bringing oil prices back on track.
Russian President Vladimir Putin called for a solution to “challenging” situation of global oil markets.
Meanwhile, the US crude inventories increased by 13.8 million barrels, their biggest since 2016.
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CMC Markets analyst Margaret Yang was quoted by the news agency as saying: “The market is hoping that this US intervention will bring us closer to an agreement between Saudi and Russia in cutting production.”
According to research firm Rystad Energy, global crude oil demand for this month will fall nearly 23% year-on-year, to 77.6 million barrels per day.
ING said in a note: “This is a clear sign that the Saudis are not ready to back off in the price war, despite the Russians now saying that they will not increase output given the current oversupply in the market.”