Opec agrees 1.2m bpd oil output cut

OPEC and partner countries including Russia agreed yesterday to cut oil output by a combined 1.2 million barrels a day in the hope of boosting prices, Iraq’s oil minister said. “We’ll cut 1.2 million bpd total,” Thamer Abbas al-Ghadhban told reporters after a meeting in Vienna. He said the amount -- equivalent to just over one percent of global production -- would comprise an 800,000 bpd reduction by the 14 members of OPEC and 400,000 by non-cartel partners, including Russia.

The cut will be based on October output and will be subject to review in April, said a spokesman for the Vienna meeting, Tafal al-Nasr. OPEC and its partners, which together account for around half of global output, say a glut in the market has led to oil prices falling by more than 30 percent in two months. The price of Brent, the European benchmark, surged five percent yesterday after reports emerged that OPEC and its non-member partners had agreed to cuts.

Bloomberg news agency reported that producers had together agreed to cut output by a combined 1.2 million barrels per day. Emirati Energy Minister Suhail Mohamed al-Mazrouei, speaking at the start of the meeting at OPEC headquarters in Vienna, said that the organisation’s member countries had a “final draft” to discuss with non-members, indicating that members had made progress since a meeting on Thursday broke up without agreement.

Also speaking at the start of the meeting between OPEC and partner countries, Russian Energy Minister Alexander Novak said he was “confident that our resolve to achieve results is as strong as ever”. “It is important to send a strong message to the market to act with resolve”, he added. Novak held bilateral meetings with several counterparts, including Iranian oil minister Bijan Namdar Zanganeh before the full meeting