OPEC, Russia agree to slash oil output from January

OPEC and its Russia-led allies agreed on Friday to slash oil production by more than the market had expected despite pressure from US President Donald Trump to reduce the price of crude.

The producer club will curb output from January by 0.8 million barrels per day versus October levels while non-OPEC allies contribute an additional 0.4 million bpd of cuts, in a move to be reviewed at a meeting in April.

Oil prices jumped about five per cent to more than $63 a barrel as the combined cut of 1.2 million bpd was larger than the minimum 1 million bpd that the market had expected.

Saudi Arabia has faced demands from Trump to help the global economy by refraining from paring supplies.

An output curtailment also would provide support to Iran by increasing the price of oil amid attempts by Washington to squeeze the economy of OPEC’s third-largest producer.