OPEC+ decides to reduce oil output by an extra million barrels

OPEC+ decides to reduce oil output by an extra million barrels

OPEC+ decides to reduce oil output by an extra million barrels

OPEC+ members decided to enforce an extra 1 million barrels per day of oil output cuts in addition to Saudi Arabia's much anticipated voluntary extension of the same amount of cutbacks.

Over the last two months, the prognosis for oil has deteriorated due to an abundance of supply and a dismal economic environment.

The reps, who wished to remain anonymous due to the confidentiality of the material, said that members had approved it in principle and that a vote would be held on it at the meeting.

The agreement achieves what the participants had said were Riyadh's objectives for the summit. Some members seem to have worked out their internal differences over output quotas after more than a week of preliminary meetings. In London, oil increased 1.4% to $84.22 a barrel.

After crude oil prices dropped more than 10% from their September highs, Saudi Arabia exerted more pressure on the Organization of the Petroleum Exporting Countries and its partners to increase production restriction measures. A repeat oil surplus might be avoided in 2019 by extending Riyadh's voluntary reduction and implementing further collective cuts.

Over the last two months, the prognosis for oil has deteriorated due to an abundance of supply and a dismal economic environment. Next year, when many, including the International Energy Agency, anticipate a significant slowdown in demand growth, prices may drop much more.