US president calls disappearance of Saudi journalist 'a bad situation', adding he discussed the case with Saudi Arabia.

US President Donald Trump has implied that Jamal Khashoggi, the missing journalist, has been murdered, saying it "certainly doesn't look like he's around", but said he would not cut arms sales to Saudi Arabia even if the kingdom was responsible for Khashoggi's death.

The US president suggested he did not believe Saudi Arabia's claim that Khashoggi had safely left its consulate in Istanbul before he disappeared more than a week ago. "He went in, and it doesn't look like he came out. It certainly doesn't look like he's around," Trump told Fox News.

Turkey, meanwhile, said it had accepted Saudi proposals to set up "a joint working group" to investigate the case. It was not clear how such a group would work given that Turkish officials have accused Saudi Arabia of murdering and dismembering Khashoggi.

EVAN VUCCI/AP Trump has implied that the missing journalist has been murdered but said he would not cut arms sales with Saudi Arabia.

The president's comments came amid growing anger in Congress towards Saudi Arabia over allegations that a 15-man Saudi "hit squad" killed the journalist and may have filmed his death. Democratic and Republican senators banded together to trigger an investigation and said the US government must examine whether the "highest-ranking officials in the government of Saudi Arabia" were involved.

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* Saudi journalist believed 'killed' at consulate in Istanbul

* Mystery surrounding missing Saudi writer deepens

* Saudis lay in wait for reporter Khashoggi and left Turkey quickly

Under US law, a bipartisan group of senators can force the White House to carry out an investigation and to consider whether to bring sanctions against foreign government officials suspected of murder or kidnapping.

HASAN JAMALI/AP Saudi journalist Jamal Khashoggi apparently went missing after going to the Saudi Consulate in Istanbul.

"There will be a bipartisan tsunami against Saudi Arabia here if they did in fact do this," said Lindsey Graham, a Republican senator close to the White House. "This is a defining moment for us. Behaviour like this is unacceptable."

But Trump said he would not scale back US$110 billion (NZ$168b) in US arms sales to Saudi Arabia even if it was proved that the kingdom had murdered Khashoggi, who regularly criticised the Saudi government.

"I would not be in favour of stopping a country from spending $110 billion, which is an all-time record, and letting Russia have that money and letting China have that money," Trump said. "What good does that do us? There are other things we could do."

Saudi writer Jamal Khashoggi was killed and dismembered in Istanbul consulate by hit squad deployed by Saudi leadership, a report says.

Trump said: "there will be something that has to take place" but did not give specifics. He also noted that Khashoggi was not an American citizen and did not disappear in the US.

The UK and US sell large quantities of weapons to Saudi Arabia and provide logistical support for its much-criticised bombing campaign in Yemen.

Saudi Arabia has vehemently denied any responsibility for the disappearance. A Turkish government spokesman said yesterday that the two sides had agreed to set up a joint investigation, a sign of a potential thaw in the tense stand-off.

JACQUELYN MARTIN/AP People hold signs during a protest at the Embassy of Saudi Arabia about the disappearance of Saudi journalist Jamal Khashoggi, in Washington.

Saudi officials earlier reportedly reneged on a deal to let Turkish police search the consulate after learning that investigators planned to use a chemical that exposed bloodstains.

A Turkish source told The Daily Telegraph that the Saudis were also resisting a search of the Saudi consul-general's official residence, which is near the consulate.

Video footage from the day of Khashoggi's disappearance shows that black vans drove from the consulate to the residence, raising suspicions that the journalist's body might have been transported there.

Turkish officials told The New York Times that Khashoggi's killers might have filmed his death as evidence to show superiors that they had completed their mission.