Market Alerts

Trump: Saudis and Russia may cut production. Brent rises $8, gives back $4

April 2, 2020

President Trump tweeted that he spoke with Russian President Putin and Saudi Crown Prince Mohammad Bin Salman
Trump both “hopes and expects” that they will cut approximately 10 MMbbls/d
Per Bloomberg headlines, Saudi Arabia is calling for an urgent OPEC+ meeting
Brent soared as much as 41%; WTI was up as much as 30%
Trading was halted due to limit-up movement
Prices have since come off with Brent hovering above $30/Bbl and WTI above $25/Bbl
In response, speaking to Bloomberg, Texas Railroad Commissioner Sitton stated that the world is 20-24 MMBbls/d oversupplied
AEGIS notes global demand may be instantaneously lower than the rumored 10 MMBbl/d cut. Our analysis shows a drop of OPEC production of this magnitude could take months
We also note this news may help market sentiment, but the effect on the global supply-demand balance may take time

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