The 14-member international oil cartel, Organization of the Petroleum Exporting Countries (OPEC) has agreed its first supply cut in eight years in order to boost the price of oil.
Mohammed bin Saleh al-Sada, OPEC’s president, said a cut of 1.2 million barrels a day would start from January.
It comes after more than two years of depressed oil prices, which have more than halved since 2014, due to a supply glut on the market.
Libya and Nigeria, which have been trying to ramp up production in the wake of disruptions to their oil flows from internal conflicts, are exempt from the deal, while Iran will be allowed to raise its output to the pre-sanction of 3.975 million barrels a day.
The price of brent crude jumped 10% to $51.94 a barrel, and US crude rose 9% to $49.53 as the news of the decision hit the markets.
In addition to the production cut by OPEC members, non-OPEC countries will be expected to reduce production by 600,000 barrels a day, according to Mr al-Sada.
He did not list which countries these might be, beyond saying Russia was prepared to cut 300,000 barrels from its output of more than 10 million barrels a day.