The US-China trade dispute and the prospect of a rapid rise in US interest rates have brought global stocks down from this year's record highs and ignited concern that oil demand will be insufficient to soak up any excess supply.
Brent crude, the global benchmark, rose US$4, or 8 per cent, to settle at US$54.47 a barrel.
China's waiver on United States sanctions on Iran allows it to buy 360,000 bpd of oil for 180 days.
However, the market seems to be ignoring this move as oil prices are continuously falling in the worldwide market despite this production cut.
The pact between the Organisation of Petroleum Exporting Countries and its allies, including Russian Federation, initially buoyed prices, but the gains were quickly. USA crude was up 10 per cent to US$46.80 a barrel, while Brent rose 9.2 per cent to US$55.11 a barrel.
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U.S. crude futures settled at $42.53 a barrel, down $3.06, or 6.7 per cent. Brent crude futures settled down $3.35, or 6.2 per cent, at $50.47 a barrel. They had fallen 6.2 percent to $50.47 a barrel in the previous session - the lowest since August 2017.
Meanwhile, WTI recouped some of the losses suffered over the last few days, trading up 2.61 percent at US$43.64 a barrel at the time of writing, after losing 6.7 percent and closing at US$42.53 a barrel in the last session.
Brent crude oil futures had yet to trade.
Wall Street initially opened higher, but stock markets pared gains amid ongoing weakness.
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And I didn't respond I'm not helping you sell your bum a- fight you drug abusing steroid cheat. The commission found the results after 18 months of drug testing conducted on Jones.
WTI prices fell from $52.58 per barrel on December 13 to $42.53 per barrel earlier this week ahead of the Christmas holiday.
While economic worries have weighed, the outlook is not as weak as in 2016 when a supply glut built up, because OPEC this time is trying to prop up the market, Jakob said.
OPEC and other major oil producers negotiated to cut oil production by nearly 1.2 million barrel a day, in the first week of December.
"Oil ministers are already taking to the airwaves with a "price stability at all cost" mantra", said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore.
The cartel has tried to reassure the market that they will maintain their supply targets, but investors have shown doubts over OPEC's plan to balance the market, especially as the weakening markets fuel fears of a global recession that could further cut down on demand.
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