Hopes that OPEC would make a deal to limit oil production helped push Brent crude within striking distance of a one-year high on Friday, but analysts say the rally may not have much further to go.
Crude prices have surged 11 percent since the Organization of the Petroleum Exporting Countries agreed last week to put a floor under oil prices by cutting production by around 700,000 a day, down from about 33.2 million barrels in August. More details are expected to be hammered out in meetings ahead of OPEC's annual gathering in Vienna on Nov. 30.
Many commodity watchers remain skeptical about how much a deal would affect prices, because market fundamentals remain weak. But the tentative agreement left speculators with a two-month window to play tug-of-war with oil prices.
"My suspicion is that the OPEC honeymoon will continue for quite a while," said Tom Kloza, global head of energy analysis at Oil Price Information Service.
Still, Kloza said that market technicians believe U.S. crude needs to strike $54.50 before traders are convinced oil prices are breaking out. He sees futures bouncing around a range of $48 to $54 until OPEC convenes on Nov. 30. Even after the OPEC meeting, oil prices will likely average $50 to $55 a month at best, he said.