Oil prices climbed noticeably on Tuesday after major oil producers reached an agreement on output.
The West Texas Intermediate (WTI) for February delivery added 2.31 U.S. dollars or a 4.85% gain to settle at 49.93 dollars a barrel on the New York Mercantile Exchange. Brent crude for March delivery increased 2.51 dollars or 4.9% to close at 53.60 dollars a barrel on the London ICE Futures Exchange.
Yesterday, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, widely known as OPEC+, agreed Tuesday to raise output slightly in February and March. Most OPEC+ producers will hold production steady in the face of new coronavirus lockdowns and two members, Russia and Kazakhstan, will be allowed to boost their output by a modest combined 75,000 barrels per day (bpd) in February and a further 75,000 bpd in March, according to a statement issued by the group at the end of its first ministerial meeting of the year. Meanwhile, Saudi Arabia pledged a voluntary oil production cut of 1 million bpd beyond the required OPEC+ quotas in February and March.
In the December meeting, OPEC+ agreed to increase oil production by 500,000 barrels per day from January, putting its current cuts at 7.2 million bpd.