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The agreement on reducing of oil production was signed for the first time in eight years, according to investing.com.
Brent crude was at $54,95 per barrel by 12-05-2016 10:45am (UTC-5). At the bid opening it was at $54,22; at the previous closing – $54,46.
The WTI crude was at $51,92 per barrel by 12-05-2016 10:45am (UTC-5). At the bid opening it was at $51,49; at the previous closing - $51,68.
The oil prices went up after the OPEC member countries have signed an agreement on oil output limiting for the first time since 2008. It was aimed at reducing the oil glut, which caused the collapse of prices. Since the mid 2014 the cost of oil has fallen more than twice.
Since the January 2017 the oil output volume will be reduced by 1,2 million barrel per day, the agreement will be reviewed in six months and probably it would be extended for six more months.
The cartel is responsible of the third part of the world oil output volume – 33,6 million barrels per day.
The agreement is also presupposes concerned action among non-OPEC countries as well, which are expected to cut oil production by 600 000 barrel per day.
Russia has expressed the willingness to cut production by 300 000 barrel per day.
According to analysts, the oil output limiting by one group of producers may lead to an increase of number of the shale oil producers in the USA.
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