On Friday, oil prices declined by nearly 4% amid high volatile oil market, this resulted Brent to end the week on a lower note, while WTI was slightly up. Following a renewed decline in the U.S. oil rig count, the oil prices rose by 2.5% today. On Friday, the increase in U.S. crude oil stocks to a record level weighed on the oil prices.

Market is still uncertain whether the oversupply will reduce by Russia's and Saudi Arabia's agreement to freeze production at January levels. Further increasing the uncertainties, the deal is signed only by four producer countries, as consent from Iran and Iraq is still pending. However, Iran and Iraq are seen in favour of the agreement. Apart from Iran and Iraq, other counties are not in a state to increase their oil production in any circumstances.

There are increasing signals in the market that the oil production in the U.S is likely to decline in the forthcoming months. Last week, the oil rig count dropped by another 26 to 413, a level last seen in December 2009. From the beginning of 2015, the oil rig count has declined by more than 70%. U.S. oil production recorded its fourth continuous weekly decline as it dropped by 51,000 barrels per day.