Oil prices jumped $4, or almost 10%, today as Russia said it was ready to join forces with OPEC and cut output.
Traders set aside forecasts of the first drop in oil demand in 25 years in anticipation of joints efforts by the Organisation of Petroleum Exporting Countries and Russia to slash production in a bid to propel prices.
Light sweet crude for delivery in January jumped $4.16 to $47.68 a barrel in New York. Brent North Sea crude for January rallied $4.33 to $46.73 in London.
Russia is ready to join forces with OPEC to stem the plunge in crude prices and could even become part of the oil cartel if membership were in Moscow's interests, Russia President Dmitry Medvedev said today.
Russia is not an OPEC member but ranks alongside Saudi Arabia, de facto leader of the cartel, as the world's largest oil exporter.
The comments came ahead of a meeting of 13-member OPEC on December 17 where coordination with non-OPEC oil producers like Russia is expected to be a major issue.
The cartel is widely expected to cut production in an effort to bolster prices that have plunged from record highs above $147 in July.
OPEC, which pumps 40% of world crude, has called on non-members to play a role in reducing output to stem the sharp slide in crude prices of the last five months.
The oil market today largely ignored the International Energy Agency's (IEA) forecast that global oil demand would fall this year for the first time since 1983 owing to a worldwide economic slowdown.
