Oil prices gave up early gains on Monday as heightened oversupply concerns amid coronavirus lockdown across the world overshadowed investor optimism over OPEC's historic production cut agreement.
Benchmark Brent crude dropped 1.65 percent to $30.96 per barrel, giving up sharp early gains. U.S. West Texas Intermediate (WTI) crude futures were little changed at $22.80 per barrel, after having risen around 6 percent earlier in the day.
After four days of painstaking negotiations by video conference, the Organization of the Petroleum Exporting Countries (OPEC), Russia and other producers, a group known as OPEC+, finally reached a conclusive agreement on Sunday to cut production by 9.7 million barrels per day (bpd).
The U.S., Brazil and Canada will contribute another 3.7 million barrels as their production declines, and other G20 states will reduce their output by an additional 1.3 million - largely because of a slump in demand triggered by the coronavirus pandemic.
Mexico will reduce output by only 100,000 barrels a day, after rejecting its 400,000 barrel-a-day share of the original deal.
The deal, which begins on May 1 and lasts for two years, could see global oil supplies cut by as much as 20 million barrels per day - around 20 percent of global supply, Kuwait's oil minister said.
Analysts said the deal needs to hold for months and even more if prices are to push higher and stay there.
Goldman Sachs Group called the agreement "historic yet insufficient". The bank sees demand losses in April and May averaging 19 million barrels a day.