Goldman Sachs analysts said in a Tuesday note that while recent comments by Saudi Arabia and Russia pointed to a greater probability of a production cut, "higher production from Libya, Nigeria and Iraq are reducing the odds of such a deal rebalancing the oil market in 2017."
The investment bank's comments came after Russian President Vladimir Putin, speaking at an energy conference in Istanbul on Monday, gave a boost to oil prices by saying Russia was ready to join the joint measures to cap production and called for other oil exporters to join in the deal.
The non-OPEC country is the world's largest oil exporter.
Prices had already received a leg up in September after OPEC said it would limit output at its November policy meeting, in the hope of reducing a global supply overhang that has weighed on prices.
Putin's comments sent oil prices up as much as 3 percent in the U.S. session. European Brent hit a one-year high while U.S. West Texas Intermediate rose to its highest in four months. Both grades were slightly lower around noon Tuesday in Asia, with Brent moving around $51.20 a barrel, while U.S. crude was around $53 a barrel.
But Goldman cautioned that it was premature to assume that it would be pushed through.
"An agreement to cut production, while increasingly likely, remains premature given the high supply uncertainty in 2017 and would prove self-defeating if it were to target sustainably higher oil prices," the bank's analysts wrote.