By Timothy Gardner and Vladimir Soldatkin

WASHINGTON/MOSCOW (Reuters) - Russian President Vladimir Putin called on Wednesday for global oil producers and consumers to address "challenging" oil markets while U.S. President Donald Trump complained that oil cheaper "than water" was hurting the industry.

Oil prices <LCOc1> fell nearly 70% from January highs as lockdowns due to the coronavirus hammered demand and as Saudi Arabia and Russia have flooded the market in a race for market share after a deal they engineered on supply curbs broke down.

Oil and natural gas sales are a key revenue source for the Russian coffers, while shale oil producers in the United States are also suffering from cheap oil.

Speaking at a government meeting, set up via a video link as a precaution against the coronavirus, Putin said that both oil producers and consumers should find a solution that would improve the "challenging" situation of global oil markets.

He also said if investments into the oil sector fall, oil prices are sure to spike, something he said "no one needs."

"That's why we, together with the main producers and consumers, should work out such decisions, which would mitigate the situation on the market on the whole," Putin said, according to the readout of the meeting.

FLURRY OF DIPLOMACY

On Tuesday, U.S. Energy Secretary Dan Brouillette spoke with his Russian counterpart Alexander Novak about the price slump and they agreed to hold future discussions involving other major world oil producers and consumers.

The call occurred a day after Trump and Putin agreed in a phone conversation to have their top energy officials discuss global oil market turmoil.

Putin said that the United States was also worried about the state of the oil market as shale oil producers need a price around $40 per barrel to turn a profit.

"That's why this is also a hard challenge for the American economy," he said.

Trump said on Tuesday he would join Saudi Arabia and Russia, if need be, for talks about the fall in oil prices, which at current levels will squeeze out higher cost production, particularly U.S. shale output which surged in recent years.

Crude oil benchmarks ended a volatile quarter with their biggest losses in history. On Wednesday, oil slid towards $25 a barrel, after touching its lowest level in 18 years. [O/R]

"There is so much oil and in some cases it's probably less valuable than water. At some points of the world the water is much more valuable. So, we've never seen anything like it," Trump said.