Trump reluctant to cancel arms sales to Saudis

Sir Richard Branson has suspended ties with Saudi Arabia

US President Donald Trump said he would "punish" Saudi Arabia if it were found responsible for killing him.

"The kingdom confirms its categorical rejection of any threats and attempts to harm it by threatening to impose economic sanctions or the exercise of political pressure", the official continued, adding that the Saudi economy is "vital and influential" in the global economy.

Turkish officials fear Saudi agents killed and dismembered Khashoggi after he entered the Saudi Consulate in Istanbul on October 2, claiming audio and video recordings of the murder exist although they have not been released.

The new claim published by the Sabah newspaper, through which Turkish security officials have leaked much information about the case, puts more pressure on Saudi Arabia to explain what happened to Khashoggi, reports the AP.

As investors took fright, Saudi stocks tumbled by around 7% at one point on Sunday, wiping out their gains for 2018.

US President Donald Trump called Khashoggi's suspected killing "a awful thing", but stopped short of assigning blame. The sales are a "tremendous order for our companies", and if the Saudis don't buy their weaponry from the United States, they will get it from others, he said.

Donald Trump has rejected halting arms sales to Saudi Arabia over the disappearance of Jamal Khashoggi.

British tycoon Richard Branson said he was pulling back from two tourism projects in Saudi Arabia and suspended discussions with Riyadh about a $1 billion investment in Virgin's space companies.

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He wrote regular columns for the Washington Post and was highly critical of the Saudi government, especially Crown Prince Mohammad bin Salman.

McFaul said it's important to know what the president's "interests are in Saudi Arabia and clarify whether there's a conflict of interest".

"It's a shame because I really wanted to go there, we all did", Butler said. In addition, countries such as Russian Federation and China are ready to supply them with the necessary arms, if U.S. backs off.

Bloomberg, the Financial Times, The Economist and The New York Times have withdrawn as media sponsors from the event amid questions about the missing man's fate.

Reports suggest an assault and struggle took place in the consulate after Mr Khashoggi entered the building to get paperwork for a marriage.

Earlier, several United States companies and business leaders pulled out of an upcoming The Future Investment Initiative conference in Saudi Arabia as questions mount over the disappearance of the Saudi journalist.

A demonstrator holds picture of Saudi journalist Jamal Khashoggi during a protest in front of Saudi Arabia's consulate in Istanbul, Turkey.

"I do think that arms sales will be effected", the senator said, referring to USA weapons sales to Saudi Arabia. That scrutiny now threatens to fray foreign business ties with Saudi Arabia's sovereign wealth fund, which is closely associated with Salman.

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