The Organization of the Petroleum Exporting Countries and its allies known as OPEC+ agreed on Wednesday to a production cut of by 2 million barrels per day from November in an attempt to recover declining crude oil prices in the last few months.
In the first face-to-face meeting since 2020, the group of some of the world’s most powerful oil producers delivered a move that went against the U.S. pledge to lower the burden of global consumers by increasing output to make oil prices even lower.
Prior to the meeting, the market expected a cut at a range of 500,000 to 1 million barrels per day, thus, a two million bpd cut was way above market expectations, though some energy market participants had expected that kind of cut.
The international benchmark Brent crude rose 1.96% to $93.60 per barrel, while the West Texas Intermediate rose 1.72% to $88.01 per barrel.
Meanwhile, the U.S. crude oil inventories fell by 1.356 million barrels against expectations for a build of 2.052 million barrels.