Oil prices rise 4% after biggest one-day fall since 1991

* Saudi says it will lift output in fight for market share
* Russia says it can withstand low oil price for six to 10
years
* Oil unlikely to quickly regain 25% losses - analysts

By Jessica Jaganathan
SINGAPORE, March 10 (Reuters) - Oil prices rose by more than
$1 on Tuesday after a price war by top producers Saudi Arabia
and Russia sparked the biggest daily rout since the 1991 Gulf
War, but investors saw little chance of a quick price recovery
as the coronavirus cuts demand.
Saudi Arabia and Russia both said they would raise
production at the weekend after a three-year pact between them
and other major oil producers to limit supply fell apart on
Friday.
Brent crude futures LCOc1 rose $1.41, or 4.1%, to $35.77 a
barrel by 0034 GMT, while U.S. West Texas Intermediate (WTI)
crude CLc1 gained $1.25, or 4%, to $32.38 a barrel following
declines of nearly 25 percent on Monday.
Both benchmarks dropped to their lowest since February 2016
in the previous session and recorded their biggest one-day
percentage declines since Jan. 17, 1991, when oil prices fell at
the outset of the U.S. Gulf War.
Trading volumes in the front-month for both contracts hit
record highs in the previous session.
But analysts do not expect oil prices to regain the nearly
25% slump from Friday's close as the coronavirus outbreak cuts
demand.
"Oil prices rarely stay below the marginal cash cost of
supply. But with the anticipated inventory build in (the first
half) we struggle to find conviction in a snap back for oil,"
analysts from Bernstein Energy said in a note.
Energy stock prices have also fallen sharply, and shale
producers began cutting spending in anticipation of lower
revenues. Exxon shares lost more than 12%, the largest one-day
percentage loss since Oct. 15, 2008, the height of the financial
crisis. Chevron's shares fell more than 15%, the biggest loss
since the October 1987 "Black Monday" market crash.
Saudi Arabia plans to boost its crude output above 10
million barrels per day (bpd) in April from 9.7 million bpd in
recent months, two sources told Reuters on Sunday. The kingdom
slashed its export prices at the weekend to encourage refiners
to buy more. Russia, one of the world's top producers alongside Saudi
Arabia and the United States, also said it could lift output and
that it could cope with low oil prices for six to 10 years.
One the demand side, the International Energy Agency said
oil demand was set to contract in 2020 for the first time since
2009. The agency cut its annual forecast and said that demand
would contract by 90,000 bpd in 2020 from 2019.