Crude oil futures pared gains on Monday after top producers Russia and Saudi Arabia said they have agreed to cooperate on stabilizing the oil market, including limiting output.
Brent crude futures for November delivery were up $1.12 per barrel at $47.95 a barrel, after hitting a session high of $49.40. US crude for October delivery was up $1.11 a barrel at $45.55 a barrel, after reaching a high of $46.53 a barrel earlier in the session, Reuters reported.
Saudi Arabia and Russia said on the sidelines of the G20 summit in China that they signed an agreement to set up a task force to review oil market fundamentals and recommend measures and actions that will secure market stability.
"Verbal intervention was again needed to trigger a recovery towards $50," senior ABN Amro economist, Hans van Cleef, said.
"After all, if prices remain too low ahead of the meeting, there is a risk that at some point Russia and Saudi Arabia actually need to act. That would probably be the last thing they want as long as Iran is raising output."
Brent rallied to above $50 a barrel in late August, helped by growing talk of a coordinated production freeze, but prices have since fallen as few believe OPEC will act.
"Even if successful, an OPEC freeze would likely be a short-term positive but a medium-term negative for oil prices," Morgan Stanley analysts wrote in a note.
