OPEC production jumped before global deal on cuts, IEA says

But even though this weekend’s deal includes several big exporters, other major producers – such as the USA and Canada – are not involved.

Nigeria’s Minister of State for Petroleum Emmanuel Kachikwu said the oil market will normalize at a new, higher price point “toward the middle of next year”. “Skeptics will argue about compliance but the symbolism in itself can not be understated”.

Both main contracts surged nearly five per cent in early Asian trade Monday, setting a fire under energy firms in the region.

Those are the barrels the United States needs the most. “It is the first time that so many oil-producing countries from different parts of the world have gathered in one room to accomplish what we have done”.

“It has been the long-term goal of Saudi Arabia to get the involvement of Russian Federation, and this has been a major geopolitical development and I think it is historic”, said Olivier Jakob an analyst at the Switzerland-based consultancy Petromatrix. All of those countries have vowed to reduce their production in recent weeks, leaving a hole in the American refining complex that few countries other than Canada can fill.

Novak said OPEC and the non-OPEC countries at the meeting were responsible for 55 percent of global output.

The kiwi dollar advanced to 71.88 USA cents as at 8am in Wellington, from 71.44 cents late yesterday. The biggest reductions on a gross basis are by Saudi Arabia (486,000 barrels a day) and Iraq (210,000 barrels a day).

“This is because we are convinced that the expectations relating to voluntary production cuts, which have been driven to excessively high levels in recent weeks by oil producers, can not be fulfilled”. “I see a victor being Canadian heavy oil differentials”.

Crude prices soared Monday morning and propelled Canadian oil stocks sharply higher after non-OPEC nations agreed to cut production in a deal with their OPEC rivals.

But their mere agreement to participate shows how desperate they are to get prices to a more profitable level, he noted.

But Bloomberg calculations, based on OPEC data, indicated that there would be little overall reduction in record oil inventories in 2017 – even if OPEC can convince non-members to come onboard.

Talking aside, according to an OPEC source that had talked to Reuters, Saudi Arabia’s oil production hit a record-high volume in November at 10.72 million bpd, compared to 10.625 million bpd in October.

“The exchange rate is now N305 but the daily production is still 2.2m barrel per day and the crude oil is left at $42.5 per barrel, “he said”.

Concerns were also rumbling about U.S. -Sino relations after Donald Trump re-ignited controversy over Taiwan.

OPEC officials have expressed the hope that by midnight on the last day of 2016, oil will be approaching $60 a barrel, or double what it was in January.

The deal is the first time that OPEC and non-OPEC producers have agreed to cooperate on production levels since 2001.

Opec’s 14 members together produce about one-third of the world’s oil but the U.S. shale boom has shaken the cartel’s dominance, making a rare global pact crucial in helping the oil market to recovery. USA output declined, eventually, but much more slowly than Saudi officials had thought.