But relentless drilling in US shale fields and renewed output from Libya are putting that effort in jeopardy.
Once stabilisation occurs, it should provide some support for prices, and the relatively large number of hedge fund short positions should then help fuel a limited rally once fund managers start to cover them.
Iranian Oil Minister Bijan Zageneh said Wednesday from Tehran that talks were under way with other OPEC members to review current market conditions. To top it all, as per the latest data, the OPEC members, particularly Nigeria, Libya, and Iraq, have ramped up their output in the last month, raising questions about the effectiveness of the oil cartel's production quotas. Russian Federation indicated it's opposed to any additional reductions, said one delegate.
OPEC countries still account for a considerable amount of global oil reserves, and The Economist Intelligence Unit forecasts that the bloc will continue to represent around 40% of total production for the next five years, despite the rapid recovery of the United States oil industry. Do they want to lose share?
"I've been more anxious about deflation".
USA crude futures ended up 21 cents a barrel at $42.74 a barrel.
Output rose last week to 9.35 million barrels a day, the highest level since August 2015, according to data from the Energy Information Administration. "Somebody at OPEC has to cut further but no one is willing".
Brent oil, meanwhile, is below $45 a barrel for the first time this year.
U.S. stocks opened little changed on Thursday as oil prices remained near multi-month lows, undermining efforts by major producers to stabilize the market. According to Bloomberg, there were 5,946 drilled-but-uncompleted wells in the USA at the end of May, which is the highest in the last three years ((Shale's Record Fracklog Could Force Crude Prices Even Lower, 19th June 2017, www.bloomberg.com)). Earlier today, it hit an intraday low below $45, marking a peak-to-trough fall of more than 20 per cent to meet the definition of a bear market. Russian Federation is the largest contributor to the agreement outside of OPEC.
Any fresh agreement has been made potentially more complicated by political and diplomatic changes.
According to the minister, some OPEC and non-OPEC members including Saudi Arabia and Russian Federation are optimistic about the rise in prices in the coming months.
In fact, though the Brent-WTI spread rose to $3.28 per barrel just a few days before the announcement, the spread contracted a day after it, likely due to the market's disappointment with the scale of the cut.