Higher world oil prices loom
OPEC has persuaded 11 non-members to cut oil production, a move aimed at draining a worldwide oil glut and boosting low prices that have squeezed government finances in Russia and Saudi Arabia.
Officials said yesterday that non-members agreed to cut 558,000 barrels per day for six months starting January 1, and that the deal was renewable for another six months after that. The figure was less than the 600,000 barrels a day that OPEC had hoped for.
Those non-member cuts come on top of an OPEC decision November 30 to reduce member output by 1.2 million barrels a day.
Oil fell from over US$90 per barrel in early 2014 to as low as US$40 earlier this year, briefly sending the average price of regular gasolene at the pump to under US$2 for motorists in the United States. Oil closed at $51.58 last Friday, up six per cent since the OPEC production cut was announced.