Members of the Organisation of Petroleum Exporting Countries and their Russia-led allies on Wednesday agreed on a major cut in oil production.
The decision was reached to prop up prices that could bolster sanction-hit Moscow’s coffers and irk Washington.
The price of Brent, the global benchmark for crude, gained $1.62 by rising to $93.4/barrel at at6.23 pm on Wednesday.
Nigeria which is a strong member of OPEC pumps over 1.4 million barrels of crude daily.
However, the figure has been affected due to the activities of vandals and oil thieves in the Niger Delta.
According to Iran’s OPEC Governor, Amir Zamaninia, the 13-nation OPEC cartel and its 10 Russian-led allies agreed to reduce two million barrels per day from November at a meeting in Vienna.
It is the biggest cut since the height of the COVID-19 pandemic in 2020.
The move could turbocharge crude prices, further aggravating inflation which has reached decades-high levels in many countries and is contributing to a global economic slowdown.
It could also give Russia a boost ahead of a European Union ban on most of its crude exports later this year and a bid by the group of seven wealthy democracies to cap the country’s oil prices.
US President Joe Biden personally appealed to Saudi leaders in July to boost production to tame prices which soared following Russia’s invasion of Ukraine earlier this year.
But crude prices have fallen in recent months on concerns over dwindling demand and fears over a possible global recession.
An analyst at trading platform OANDA, Craig Erlam said, “With consumers only just breathing a sigh of relief after being forced to pay record prices at the pump, today’s cut is not going to go down well.”
The energy minister of the United Arab Emirates, Suhail al-Mazrouei, when asked how the United States would react to a cut, he insisted that OPEC was merely a “technical organisation”.
Alexander Novak, the Russian Deputy Prime Minister in charge of energy, who is under US sanctions, remained mum as he arrived for the group’s first in-person meeting at its Vienna headquarters since March 2020.