Saudi Arabia could admit Jamal Khashoggi was killed in interrogation gone wrong: Report

US President Donald Trump speculated on Monday that "rogue killers" may have been behind the disappearance of prominent Saudi journalist Jamal Khashoggi and dispatched Secretary of State Mike Pompeo to meet King Salman over the case.

Khashoggi, a US resident, Washington Post columnist and leading critic of the powerful Saudi crown prince, Mohammed bin Salman, vanished after entering the Saudi consulate in Istanbul two weeks ago to get marriage documents. Turkish officials say they believe he was murdered there and his body removed.

Saudi Arabia is preparing a report that would say Khashoggi was killed as the result of an interrogation that went wrong, CNN reported on Monday, citing two unidentified sources. The Saudi government could not immediately be reached for comment on the CNN report.

The New York Times, citing a person familiar with the Saudi plans, reported that Prince Mohammed bin Salman had approved an interrogation or rendition of Khashoggi back to Saudi Arabia. The Saudi government, it said, would shield the prince by blaming an intelligence official for the botched operation.

The case has provoked an international outcry against Saudi Arabia, the world's top oil exporter, with more media and business executives pulling out of a planned investment conference there this month.

While organizers said Monday the conference will go on, the Saudis cancelled an annual diplomatic reception in Washington set for later this week.

Many members of the US Congress, which has long had a testy relationship with Saudi Arabia, have issued strong criticism of the kingdom over the case.

Turkish authorities have an audio recording indicating that Khashoggi was killed in the consulate, a Turkish official and a security source told Reuters, and have shared evidence with countries including Saudi Arabia and the United States. They provided no further details.

Saudi Arabia has strongly denied killing Khashoggi and has denounced such assertions as "lies", saying he left the building shortly after entering.

"The king firmly denied any knowledge of it," Trump told reporters after speaking with King Salman. "He didn't really know, maybe - I don't want to get into his mind but it sounded to me - maybe these could have been rogue killers. Who knows?"

The US president gave no evidence to support the theory.

Trump called his top diplomat on Sunday night and asked him to have face-to-face meetings with the Saudi leaders, according to State Department spokeswoman Heather Nauert. "Determining what happened to Jamal Khashoggi is something of great importance to the president," she said.

Pompeo will go to Turkey from Saudi Arabia, the White House National Security Council said.

Turkish police investigators entered the Istanbul consulate late on Monday. A Turkish diplomatic source had earlier said a joint Turkish-Saudi team would search the building - the last place Khashoggi was seen before he vanished on Oct. 2.

"It has been 13 days since the event, so surely proving some of the evidence might be difficult, but we believe we will obtain evidence," the Turkish official said.

A Saudi official, not authorized to speak publicly, told Reuters that the king had ordered an internal investigation based on information from the joint team in Istanbul.

King Salman and Turkish President Tayyip Erdogan spoke by telephone on Sunday evening and stressed the importance of the two countries creating a joint group as part of the probe.

ECONOMIC IMPACT

Trump has threatened "severe punishment" if it turns out Khashoggi was killed in the consulate, although he has ruled out cancelling arms deals worth tens of billions of dollars with Saudi Arabia. European allies have urged "a credible investigation" and accountability for those responsible.

Britain expects Riyadh to provide "a complete and detailed response" to questions over Khashoggi's disappearance, Prime Minister Theresa May's spokesman said on Monday.

British foreign minister Jeremy Hunt told his Turkish counterpart Khashoggi's disappearance remains "deeply concerning."

Khashoggi, a familiar face on Arab talk shows, moved to the United States last year fearing retribution for his criticism of Prince Mohammed, who has cracked down on dissent with arrests.

A pro-government Turkish daily published preliminary evidence last week from investigators who it said had identified a 15-member Saudi intelligence team that arrived in Istanbul on diplomatic passports hours before Khashoggi disappeared.

The Saudi consulate referred Reuters to authorities in Riyadh, who did not respond to questions about the 15 Saudis.

Saudi Arabia has responded to Western statements by saying it would retaliate against any pressure or economic sanctions "with greater action," and Arab allies rallied to support it, setting up a potential showdown between Saudi Arabia and its main Western allies.

The Saudi riyal fell to its lowest in two years and its international bond prices slipped over fears that foreign investment could shrink amid international pressure.

The Saudi stock market had tumbled 7.2 percent over the previous two trading days but rebounded 2 percent on Monday.

BACKLASH

Concern over Khashoggi's disappearance has seen media organizations and a growing number of guests pull out of a "Davos in the Desert" investment conference set for Oct. 23-25, which has become the biggest show for investors to promote Prince Mohammed's reform vision.

JPMorgan Chase & Co (JPM.N) Chief Executive Jamie Dimon became the most high-profile banker to withdraw from the event on Sunday night. Blackstone CEO Stephen Schwarzman and BlackRock Chief Executive Larry Fink also were pulling out, according to a source familiar with the matter. Both companies declined comment.

Saudi Arabia's Public Investment Fund which hosts the conference, has tentatively committed $20 billion to an infrastructure investment planned with Blackstone Group. Prince Mohammed told Reuters last year that Blackstone and BlackRock Inc were planning to open offices in the kingdom.

The organiser insisted the conference would go ahead, with more than 150 speakers confirmed.

Saudi Arabia's Arab allies have rushed to its support.

Bahrain called for a boycott of Uber, in which PIF has invested $3.5 billion, after its chief executive officer said he would not attend the conference.

Similar campaigns trended on social media in Saudi Arabia and the United Arab Emirates.