OPEC agrees to cut output for 1st time in 8 years

Bank stocks also rose. That was the highest level in over a month.

But he added that even if OPEC failed to reach a deal, the market would slowly recover: “We believe that non-OPEC growth has reversed and also most of the OPEC growth we’ve seen is already behind us”, he told reporters. Eastern. The Standard & Poor’s 500 index was down 1 point, less than 0.1 per cent, to 2,205 and the Nasdaq composite lost 39 points, or 0.7 per cent, to 5,340. Bond yields are linked to higher interest rates. The Russell 2000, a collection of mostly smaller companies, has soared 11.5 per cent this month alone, it’s best month since October 2011. Moreover, they are still more than 300 MMbbl the five-year average. USA government bonds quickly become less appealing to investors in a healthy, growing economy and in an inflationary environment.

Some analysts including Morgan Stanley and Macquarie have said oil prices will correct sharply ifOPEC fails to reach a deal, potentially going as low as $35 per barrel. Iran, which is considered crucial to a breakthrough because its output has been rising after Western sanctions were lifted, said it was also “optimistic”.

Mr Al-Sada said cartel members would reduce output by 1.2million barrels a day from January, lowering Opec’s daily production ceiling to 32.5million.

The pact is seen as a boon for US shale producers, who have developed techniques to pump crude at a price nearly as low as that of Iran and Iraq.

When asked if OPEC had made a mistake to ramp-up production two years ago when oil prices first started falling instead of performing a production decrease as it has done now, Al-Sada said the organization had to make a decision then based on the reality at the time.

US West Texas Intermediate (WTI) crude was up 71 cents, or 1.57 per cent, at $45.94 a barrel. Eastern [1709 GMT]. The move was the largest one-day gain since February.

Brent crude futures for delivery in January were up $3.83, or 8.3 per cent, at $50.21 a barrel by 1236 GMT, recovering from a drop of almost 4 per cent on Tuesday and on course for their biggest one-day move in nine months.

Trump has promised to eliminate regulations restricting fracking, support oil and gas pipeline construction and open restricted federal lands and offshore areas for exploration, including Alaska. Ocean rig operator Transocean jumped $2.05, or 19 per cent, to $13.07.

The Saudis, like most oil producing nations, have been under severe financial stress as the price of oil has more than halved since 2014. Goldman Sachs helped drive the Dow higher with a gain of 3.8 percent.

It has meant an electrifying run for the dollar, which was up at 1.0645 per euro and 113.04 yen as USA trading began and as it headed for its strongest month against the Japanese currency in seven years. The euro fell to $1.0599 from $1.0647.

Britain’s BP, for example, saw its share price spike 3.4 percent, while France’s Total rose 1.7 percent.

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