The Organization of the Petroleum Exporting Countries (OPEC) and Non-OPEC oil producers on Friday agreed to jointly cut the crude production by 1.2 million barrels per day (bdp), to be implemented in January 2019 for an initial period of six months.
OPEC and its partners, which together account for about half of global output, say a glut in the market has led to oil prices falling by more than 30 percent in two months.
The U.S. Energy Department's Energy Information Agency (EIA) identifies the non-OPEC oil-producing countries to include Russian Federation, the United States, China, Mexico, Canada, Norway and Brazil.
An output reduction would provide support to Iran - OPEC's third-largest producer - by increasing the price of oil amid attempts by Washington to squeeze the country's economy.
Data released Friday from Baker Hughes BHGE, +0.88% also implied a decline in future output, with the number of active us rigs drilling for oil down by 10 at 877 this week.
"I have also seen him at three times at various energy events in India where he was very vocal", Al Falih said. U.S. West Texas Intermediate crude futures were up $2.17, or 4.2 percent, at $53.66 per barrel. On Wednesday, just before OPEC officials started talking about how to stabilize the oil market, Trump lobbed a rhetorical grenade in their direction: "Hopefully OPEC will be keeping oil flows as is, not restricted".
Al-Falih said the kingdom would downshift to about 10.2 million barrels a day in January, down 900,000 barrels a day from November.More news: Switching will not enable Apple Watch's ECG feature internationally
"Reversing the overwhelmingly bearish price sentiment will likely require a credible and cohesive message from the Opec meeting", U.S. investment bank Jefferies said on Friday. Following the announcement, Brent crude, the worldwide standard, was up $2.79 a barrel, or 4.7 percent, at $62.85.
Physical markets were taken aback by the U.S. granting waivers on the Iran sanctions to the eight largest importers of Tehran's crude.
Sarah Ladislaw, head of the energy and national security program at the Center for Strategic and International Studies, knocked down the idea that being a net exporter would free the US from global market dynamics. The Delaware Basin, the less drilled part of the field, holds more than twice the amount of crude as its sister, the Midland Basin, the U.S. Geological Service said Thursday. The key goal of the meeting was to negotiate production cuts in order to boost global crude prices that have seen a dramatic drop of almost 30 percent over recent months.
OPEC's de facto leader Saudi Arabia, under economic pressure after a collapse in oil prices last month, has sought to walk a fine line between preventing a surplus next year and appeasing Trump.
Asked about pressure from Trump, Al-Falih said that oil companies in the United States would appreciate the group's efforts.
The shale revolution has transformed oil wildcatters into billionaires and the USA into the world's largest petroleum producer, surpassing Russian Federation and Saudi Arabia. "The U.S. economy is actually much more integrally linked with the global oil market [now] because we produce and consume oil in greater volumes", she said.
In the end, the meetings showed the art of the possible, with a sizeable 1.2 million bpd cut - 0.8 percent from OPEC itself, and another 0.4 million from its allies.
If the U.S. Congress decides to impose sanctions, the Saudis could react by reducing oil exports further and force prices to rise to $100 a barrel, some market experts said.