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Saudi Arabia and Russia have reached a deal on deep oil output cuts, Reuters reported on Thursday, citing an OPEC source familiar with the matter. 

“Russia and Saudi Arabia have managed to remove their main obstacles to agreeing on a new deal on oil cuts,” a senior Russian source told Reuters. “OPEC+, others to discuss oil cuts as big as 20 million barrels per day,” one OPEC and one Russian source added.

Market reaction

With the initial market reaction to this headline, crude oil prices shot higher. As of writing the barrel of West Texas Intermediate was trading at $27.55, adding 5.6% on the day.