The current output strategy by OPEC that saw nine members led by Riyadh cut production to boost prices has failed to bring about lasting recovery. AP
Sentiment also won a partial boost after Israel and Hamas announced a deal allowing at least 50 Israeli captives and scores of Palestinian prisoners to be freed while offering besieged Gaza residents a four-day truce after weeks of Israeli bombardment and a ground invasion of the strip, left more than 14,100 Palestinians dead, many of them women and children.
A statement announcing a delay to next Thursday of a planned summit of the 13-member OPEC group led by Saudi Arabia and their 10 partners led by Russia did not provide any explanation.
The oil exporters are due to decide on their output policy amid slumping crude prices and weak crude demand as China's post-Covid rebound stutters and Europe and the United States battle inflation.
The current output strategy by OPEC+ that saw nine members led by Riyadh cut production to boost prices has failed to bring about lasting recovery.
Oil prices, which had been trading modestly lower, spiralled lower. The main US contract WTI briefly dropped by five percent while the main international crude contract, Brent, fell back under $80 per barrel.
"The delay of the meeting has sent prices lower because it increases the risk of the Saudi's removing their additional voluntary cuts to the tune of one million barrels per day that has been in place since July," said City Index and FOREX.com analyst Fawad Razaqzada.
Some analysts have pointed to possible discord between top oil exporter Saudi Arabia -- which has pushed for production cuts to support prices -- and Russia.
Recently, "the Saudi Arabian energy minister blamed speculators for the oil price slide" rather than weak demand, suggesting that they would likely continue the "restrictive production policy", said analyst Carsten Fritsch of Commerzbank.
On the other hand, Russian Deputy Prime Minister Alexander Novak said on Wednesday that "current oil prices objectively reflect the current situation" and that "the market is balanced", according to Russian news agencies.
Bloomberg News reported that Saudi Arabia was unhappy with the production levels of other members, citing delegates.
In equities trading, Wall Street's three main indices were higher in late morning trading, with data showing continued strength in the US labour market.
In Europe, Frankfurt and Paris stocks closed with gains.
But London dipped despite the announcement of measures by the UK government to boost the nation's ailing economy as updated forecasts cut the growth outlook while predicting inflation would remain higher for longer.
Asian equity indices diverged as traders tracked a tepid lead from Wall Street following meeting minutes showing Fed officials were inclined to keep interest rates elevated for "some time" in order to tame inflation.
Minutes from the Fed's October-November policy meeting showed decision-makers recognised the impact that more than a year of rate hikes has had on inflation -- which has dropped from the four-decade high seen last year -- but were mindful to make sure they got the job done.
Yet many traders remain hopeful that the central bank will opt for a cut at some stage next year.