4-2-20 RCC Energy Market Update

Markets moved significantly higher today after news broke from President Donald Trump’s Twitter that Saudi Arabia and Russia have agreed to curbing production by 10 million barrels per day and could be as much as 15 million bpd. As the world began to digest the news the Saudi Press Agency replied later with “The Kingdom calls for an urgent meeting for OPEC+ states and other group of countries, with aim of reaching a fair solution to restore a desired balance of the oil markets”. This will make for an interesting storyline to follow in the days to come as there is still uncertainty on the validity of what President Trump announced although it was enough to rebound a beaten down energy industry lately. There are questions if a production cut would be sufficient enough to dig prices out of the deep hole that they are in knowing the extent of demand destruction across the globe has been extreme. Crude oil and gasoline posted the largest gains today with WTI gaining $5.01, gasoline added $0.1163, while distillate finished the day up $0.0628. For crude oil, it was the highest one day dollar gain in more than five years and the largest single-day percentage jump of 24.67% as traders will look to continue this momentum tomorrow.