OPEC Agrees to Cut Production in Drive to End Global Glut

Bloomberg

OPEC clinched a deal to curtail oil supply, confounding skeptics as the need to clear a record global crude glut — and prove the group’s credibility — brought about its first cuts in eight years, Bloomberg News reports.

OPEC will reduce production by 1.2 million barrels a day to 32.5 million a day, a delegate said Wednesday in Vienna, asking not to be identified as the decision isn’t yet public. Oil jumped 7.6 percent to $49.90 a barrel in London at 1:23 p.m. local time.  

After weeks of often tense negotiations, the Organization of Petroleum Exporting Countries’ three biggest producers — Saudi Arabia, Iraq and Iran — resolved differences over sharing the burden of cuts to rein in supply for the first time since 2008. Notably, it appears the Saudis accepted that Iran, as a special case, can raise production to about 3.9 million barrels a day. The agreement is also likely to include a reduction of about 600,000 barrels a day by non-OPEC countries.

http://www.bloomberg.com/news/articles/2016-11-30/opec-agrees-to-cut-output-by-1-2-million-barrels-a-day

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