Oil surged the most in more than five months as Saudi Arabia and Russia extended a cooperation pact and US-China trade tensions cooled. Unprecedented supply cuts in Canada also drove prices higher.
Futures in New York advanced almost 6 percent on Monday, bouncing back from the worst monthly slump in a decade.
Although Russia and Saudi Arabia have yet to confirm any fresh cuts, their agreement opened the door for a deal when Opec meets this week in Vienna.
Oil pared gains during Monday’s session after a key Opec advisory panel was said to make no recommendation for action on supplies ahead of the broader cartel’s gathering.
US President Donald Trump and his Chinese counterpart Xi Jinping called a pause in their trade dispute after a dinner at the G20 event.
The US agreed to postpone a planned tariff hike on Chinese goods for three months in return for greater purchases of American products. The pact prompted a rally in risk assets, including oil.
Then, Alberta Premier Rachel Notley announced the Canadian province would ord-er local producers to curtail production by 325,000 barrels a day starting next month.
“All in all the market was in desperate need of a psychological boost and that was provided this weekend,” said Ole Hansen, head of commodities strategy at Saxo Bank A/S.