GLOBAL MARKETS-Oil, shares slip on doubts over Saudi-Russia deal

* U.S. oil futures drop 4.5% on doubts on output cut deal
* Trump says has not offered U.S. output cut
* S&P500 futures fall 0.7% after energy driven overnight
gain
* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Hideyuki Sano and Herbert Lash
TOKYO/NEW YORK, April 3 (Reuters) - Oil prices retreated on
Friday after massive gains, while stocks in Asia edged down, as
doubts grew over an oil price deal between Saudi Arabia and
Russia that U.S. President Donald Trump said he had brokered.
With the coronavirus pandemic raising the risk of a
prolonged global downturn, investors continued to seek the
safety of the U.S. dollar and government bonds, pushing U.S.
Treasuries yield near their lowest in three weeks.
U.S. West Texas Intermediate (WTI) crude CLc1 lost $1.14,
or 4.5% to $24.18 a barrel in early Asian trade after having
surged a record 24.7% on Thursday. Brent futures LCOc1 dropped
$0.70, or 2.67% to $29.24.
Trump said on Thursday he had spoken to Saudi Crown Prince
Mohammed bin Salman, and expects Saudi Arabia and Russia to cut
oil output by as much as 10 million to 15 million barrels, as
the two countries signalled willingness to make a deal.
Saudi Arabia said it would call an emergency meeting of the
Organization of the Petroleum Exporting Countries, Saudi state
media reported.
The amount Trump talked about would represent an
unprecedented cut amounting to 10% to 15% of global supply, if
he meant output per day - a common unit of measurement.
But Trump did not specify and some analysts say the omission
may be intentional.
"He is a business man and smart enough to know these things.
A cut of 10-15 million barrel per day (bpd) would be simply
impossible," said Norihiro Fujito, chief investment strategist
at Mitsubishi UFJ Morgan Stanley Securities.
"How could Riyadh and Moscow agree on such a big cut, just
about a month after they had fought over a cut of 1.5 million."
In early March, talks over production cuts between the two
countries collapsed, leading them to start a price war that
pushed oil prices to the lowest levels in nearly two decades.
Nor did Trump make any offer to reduce U.S. production, now
the world's largest.
"Both Riyadh and Moscow will also be looking for
participation from U.S. producers, and this may prove now to be
the biggest obstacle to an agreement," Royal Bank of Canada
analysts said in a note.
As oil prices retreated, E-Mini futures for the S&P 500
EScv1 also fell 0.78% in Asia.
MSCI's Asia-Pacific index outside Japan .MIAPJ0000PUS
dipped 0.15% while Japan's Nikkei .N225 rose 0.3%, helped by
overnight gains in Wall Street shares. On Thursday, the S&P 500
.SPX gained 2.3%.

SAFE ASSETS IN DEMAND
Investors sought the perceived safety of government bonds.
Benchmark U.S. 10-year notes US10YT=RR fell in price to last
yield 0.593%, near a three-week low of 0.563% touched on
Thursday.
More evidence of the damage from widespread stay-at-home
orders to contain the spread of coronavirus emerged in the
United States, with an unprecedented number of workers - 6.6
million - filing jobless claims. Projections released by the U.S. Congressional Budget Office
showed U.S. gross domestic product will decline by more than 7%
in the second quarter as the health crisis takes hold.
Global coronavirus cases surpassed 1 million with more than
52,000 deaths as the pandemic further exploded in the United
States and the death toll climbed in Spain and Italy, according
to a Reuters tally. Highly rated U.S. corporate bond issuers raised a record
$110.502 billion this week, according to Refinitiv IFR data, as
firms borrowed cash in fear the coronavirus crisis may soon
limit their access to capital markets. In the currency market, the dollar maintained its firmness
against a basket of currencies as investors and companies
continued to hoard the world's most liquid currency.
The dollar index =USD has risen 1.88% so far this week,
even as extreme tightness for dollars in some markets since last
month has eased.
The euro steadied at $1.0853 EUR= after four straight days
of losses. The yen also stepped back to 107.95 per dollar JPY=
from Wednesday's two-week high of 106.925.
Gold prices rose ovenright as U.S. jobless claims hit a new
peak, intensifying fears of the coming economic slowdown and
drove investors toward the safe-haven metal.
Spot gold traded at $1,613.5 per ounce XAU= after a 1.28%
rise on Thursday.

(Editing by Jacqueline Wong)