Oil pared early losses on Monday after Russia and Venezuela appeared to be coordinating on a price defense plan, but Brent and U.S. crude still ended lower on worries over Japan's recession.
Benchmark Brent crude's front-month contract settled down 10 cents at $79.31 a barrel, after falling as much as $1.47 to a session low at $77.94.
Continue Reading Below
Front-month U.S. crude finished 18 cents lower at $75.64 a barrel, after a session bottom at $74.71.
Japan, the fourth largest crude importer, saw its economy shrink unexpectedly by an annualized 1.6 percent in the third quarter due to weak consumption and exports that pushed it into recession.
"Arguably, the Japanese recession is pulling everything down, crude included. But the oil market has another and bigger problem: that the OPEC meeting will come and go without any change in production," said Andrew Lipow, president of Lipow Oil Associates in Houston.
Traders are awaiting any sign that a Nov. 27 meeting of Organization of the Petroleum Exporting Countries will agree on an output cut to overcome a widely-perceived oil glut. Brent has fallen about 30 percent from a June high above $115 on oversupply concerns.
The chief executive of top Russian oil producer Rosneft will fly to Vienna on Nov. 25, the state-backed firm said, raising speculation he will try coordinating price action with some of the cartel's members.
Previous overtures between OPEC and Russia haven't produced results. But oil's drop below $80 a barrel has raised focus on the Nov. 27 meeting, possibly the most pivotal since the 2008 financial crisis.
Venezuela said its Foreign Minister Rafael Ramirez and Russian Energy Minister Alexander Novak had met in Moscow to discuss oil price defense. Iran, meanwhile, accused some in OPEC of making excuses not to cut production.
The moves came as Saudi Arabia's finance minister reinforced the notion that OPEC's largest oil exporter will not be cutting supplies when he said the price drop was not expected to directly impact the kingdom's budget or government spending next year. Ibrahim Alassaf has also said oil prices should be left to market forces.
(By Barani Krishnan; Additional reporting by Claire Milhench in London and Jacob Gronholt-Pedersen in Singapore; Editing by Michael Urquhart and Chris Reese)
Continue Reading Below