CNBC’s Brian Sullivan breaks down reports that the Saudis and Russia have reached a deal to cut oil production.
Oil prices jumped as much as 12% on Thursday on reports that Saudi Arabia and Russia had reached a deal on a deep output cut, according to Reuters which cited two sources, and that the cuts could reportedly be as high as 20 million barrels per day.
OPEC and its allies, known as OPEC+, would reportedly cut output by 12 million barrels per day, according to Reuters, with an additional 5 million barrels per day cut by producers outside of the group.
Prices pulled back from their highs as traders awaited confirmation of the cuts as well as key details, such as how the cuts would be divided among OPEC+, as well as how long they might be in place for.
The reported deal comes as a virtual meeting between OPEC and its allies, known as OPEC+, kicked off in which some of the world’s largest producers were set to discuss historic production cuts as the coronavirus pandemic saps demand for crude. The virtual meeting, which was initially planned for last Monday, began around 10:45 a.m. ET.
U.S. West Texas Intermediate jumped 12% to trade at $28.36 per barrel, before pulling back to trade 4.6% higher at $26.25. International benchmark Brent crude rose 3.7% to trade at $34.06 per barrel.
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