Investing.com - Oil prices bounced off two-month lows hit earlier on Monday after reports that the contemplated increase in output by Saudi Arabia and Russia may be less than originally feared.
New York-traded West Texas Intermediate crude futures rose 23 cents, or about 0.3%, to $65.08 a barrel by 10:33AM ET (14:33GMT).
Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., was last up $1.09, or 1.5%, to $74.53.
Prices hit intraday lows of $63.41 and $72.46, respectively earlier in the session.
Oil ministers from OPEC, Russia and other major producing countries will meet in Vienna on Thursday and Friday to review their current production agreement that has held back 1.8 million barrels per day (bpd) from the market for the past 18 months.
Russia has pushed for returning a million barrels per day back into the market relatively quickly in order to offset supply shortfalls from Venezuela and Iran. However, Saudi Arabia would like to try a lower amount to prevent the price from dropping too much, experts said.
However, Iran, Venezuela and Iraq have all said the current production agreement should stay in place and Tehran’s OPEC representative Hossein Kazempour Ardebili told Bloomberg that the three would block the deal.
In an effort to reach a compromise, the latest developments point to a discussion between OPEC members to deliver just 300,000 to 600,000 barrels a day of additional oil supply to global markets over the next few months, Bloomberg reported, citing people briefed on the talks.
The report was sufficient to send a wave of relief through oil markets that had declined to two-month lows in overnight trade as both the West Texas Intermediate and Brent turned positive.
Weighing on prices, U.S. output continued its unrelenting escalation. U.S. drillers added one oil rig last week, bringing the total count to 863, the highest number since March 2015, according to Baker Hughes data released on Friday.
Meanwhile, China on Friday said it would slap duties on American export products, including crude oil, as the Asian nation planned retaliatory tariffs against the U.S.
That could mean that the world's biggest importer of oil could eschew U.S. products at a time when exports of crude to Asia have been rising.
In other energy trading, gasoline futures gained 1.3% $2.0415 a gallon 10:35AM ET (14:35GMT), while heating oil also rose 1.3% to $2.1130 a gallon.
Lastly, natural gas futures traded down 1.3% to $2.982 per million British thermal units.