Oil has risen 5% on news of the deal Russia and Saudi Arabia


World oil prices rose sharply after sources Reuters and other agencies reported that the authorities of Russia and Saudi Arabia are preparing to make a joint statement about the need to coordinate actions in the oil market.

On Monday during trading on the stock exchange ICE futures price for Brent crude oil with delivery in November jumped more than 5%. The maximum cost of a barrel reached $49,38 that by 5.44% above the closing level of the previous trading session.

On Sunday, Russian President Vladimir Putin met on the sidelines of the G20 summit in China with the Deputy crown Prince of Saudi Arabia Mohammad bin Salman. During the meeting bin Salman expressed confidence that the cooperation of Saudi Arabia and Russia will allow both countries “to achieve many of the benefits in terms of future developments on the oil markets”.

2 September Putin said that Russia supports the agreement with OPEC to freeze oil and expects other oil market participants, including Iran, will also speak in support of such agreement. “I would like to hope that all the participants in this market are interested in maintaining a stable and equitable global energy prices, after all in the end will make the necessary decision”, — said Putin. On the same day, the cost of a barrel of Brent rose more than 3%.

According to experts IK “Veles the Capital” Vasily Tanurkov, oil quotes on Monday morning grew on expectations of a possible agreement on the freezing of production, which strengthened as it approached the date of the energy forum in Algeria (September 26-28), as well as the possible depreciation of the dollar after the failure of the fed from raising rates in the near future.

“In this regard, we can expect a new round of the weakening of the dollar to emerging currencies, which will be an important factor supporting oil prices”, — said Tanurcov.

The increase in oil prices was followed by a new strengthening of the ruble. In the course of trading on the Moscow stock exchange the dollar exchange rate on Monday declined to 64,5125 Euro — RUB to 72,065

On Monday afternoon on the sidelines of the G20 summit in China, Russian energy Minister Alexander Novak and Minister of energy, industry and mineral resources of the Kingdom of Saudi Arabia Khaled bin Abdul Aziz al-Faleh signed a joint statement to stabilise the oil market, reports TASS. The parties in particular agreed on a joint or in cooperation with other oil-producing actions in order to maintain stability in the oil market and ensure a sustainable level of investment in the long term.

Source