Oil Rises on OPEC Production Agreement

• Oil Rises on OPEC Production Agreement

Oil prices rose on Friday following OPEC+ agreement on production cuts.

The cartel agreed to cut more production than previously expected by the market, boosting global oil prices after days of difficult talks in Austria.

The organisation agreed to cut a total of 1.2 million barrels per day from the market.

According to delegates, OPEC allies including Russia will cut a total of 400,000 barrel a day. While OPEC members will cut a total of 800,000 barrels a day.

Iran was exempted from the cut due to U.S. sanctions that have already weakened its oil exports.

Crude surged 4.7 percent, with Brent rising as high as $63.42 a barrel and US West Texas Intermediate trading at $53 a barrel.

President Trump had repeatedly warned the cartel against higher oil prices, saying the US will is not in support.

Therefore, the market expects President Trump to react against the decision of the OPEC+ to cut production in order to artificially boost oil prices.

Meanwhile, in a surprise move, Canada announced a production cut of 325,000 barrels a day from Alberta oil field. The reduction scheduled to commence in January 2019 will run until excess oil in storage has moderated, after which the reduction will drop to 95,000 barrels a day for the rest of the year.