Oil Prices Surge As OPEC Reaches Deal To Cut Production By 1.2 Million Barrels

The Organization of the Petroleum Exporting Countries (OPEC) agreed on Wednesday to reduce their production of crude oil to 32.5 million barrels per day, which lead to a surge in oil prices. The reduction is effective from 1 January, 2017, and is the cartel's first oil reduction since 2008. The reduction is being coordinated with the non-OPEC country Russia, who promised to cut its production by 300,000 barrels per day.

According to data offered by OPEC, the largest oil producer, Saudi Arabia took the biggest part of the reduction, 486,000 barrels per day. The market was boosted by the release of OPEC deal details. The West Texas Intermediate for January Delivery increased $4.21 to settle at $49.44 a barrel on the New York Mercantile Exchange, while Brent crude for January delivery added $4.09 to close at $50.47 dollars a barrel on the London ICE Futures Exchange.