Opec countries agree first oil output cut in eight years

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.
The price of Brent crude jumped 10% to $51.94 a barrel, and US crude rose 9% to $49.53.
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.
“This agreement comes from a sense of responsibility from Opec member countries and non-Opec member countries for the general well-being and health of the world economy,” he said.
The deal comes after oil ministers agreed to a cut in principle in September, which would have limited output by about 700,000 barrels a day while allowing Iran to increase production.
But disagreements between Saudi Arabia – the world’s biggest oil producer – and Iran led to doubts an agreement would be secured.

“Without their agreement it is technically unworkable, so there is still some uncertainty hanging over it,” John Chairman of Alfa Energy Group in London told the BBC.
“So I think it is impressive they’ve got this far and got countries like Iran and Iraq to agree, but Russia could well change its mind about limiting production.”
Spencer Welch, director at IHS Energy, said the deal would provide a short term boost to oil prices, but added: “Disagreements persist among Opec members on how to measure production, so the deal will be hard to police.”
“US oil [including shale] will like the price rise and production will start rising soon,” he also said. “But, this was going to happen regardless of any Opec deal today.”
Opec will hold talks with non-Opec producers on 9 December. The group will also have its next meeting on 25 May 2017 to monitor the progress of the deal.