Saudi Arabia and Russia have agreed to co-operate in oil markets, sending oil prices higher and world stocks up pm hopes the two top producers would work together to tackle a global glut. Sonia Legg reports
The biggest jump in world shares in over a month came partly from an unexpected source. A pact between Saudi Arabia and Russia at the G20 summit in China sent oil prices surging. The two top producers said they would start working together to stabilise the market, including limiting output. (SOUNDBITE) (Russian) RUSSIAN PRESIDENT, VLADIMIR PUTIN, SAYING: "As for our relations with Saudi Arabia - we have friendly relations. And we have a similar view on cooperation in the world oil market." Crude prices leapt five percent before the gains halved as traders noticed there were no immediate measures on the table. Even so, the agreement is seen as a significant development between two countries effectively fighting a proxy war in Syria. Russia is also seen as a big ally of Iran - Riyadh's arch rival. Its return to global oil markets after years of sanctions has been fuelling the price problems. (SOUNDBITE) (Russian) RUSSIAN PRESIDENT, VLADIMIR PUTIN, SAYING: "In my view Iran had minimal extraction under sanctions. So I believe it's fair for them to return to pre-sanction levels." Previous attempts to limit output have failed because of Saudi's insistence Iran join in. Last week Putin said a new deal could involve some compromise on Iranian output. Iran's not saying, but Saudi Arabia would benefit from an output cut. It's facing budget pressures and hopes to float a stake in Aramco - its state-owned oil firm.