Higher oil prices coming after OPEC agrees to cut output

Khalid Al-Falih Minister of Energy, Industry and Mineral Resources of Saudi Arabia speaks to journalists prior to the start of a meeting of the Organization of the Petroleum Exporting Countries, OPEC, at their headquarters in Vienna, Austria, Wednesday, Nov. 30, 2016. (AP Photo/Ronald Zak)
Khalid Al-Falih Minister of Energy, Industry and Mineral Resources of Saudi Arabia speaks to journalists prior to the start of a meeting of the Organization of the Petroleum Exporting Countries, OPEC, at their headquarters in Vienna, Austria, Wednesday, Nov. 30, 2016. (AP Photo/Ronald Zak)

VIENNA (AP) — OPEC has agreed to cut 1.2 million barrels a day from its present output — the first cutback in eight years —after its 14 members put aside differences to agree on individual production levels.

The move, which will leave OPEC output at 32. 5 million barrels a day is to take effect in January.

It was announced by OPEC President Secretary General Mohammed Bin Saleh Al-Sada at the end of the meeting Wednesday. He also said major non-OPEC producers were ready to act in concert with OPEC and tentatively planning to reduce their output.

He did not list the countries involved beyond Russia saying Russia was prepared to cut 300,000 barrels from its output of more than 10 million barrels a day.

The decision to cut production could have a lasting impact on consumers, as oil price increases feed into the cost of car fuel, heating and electricity.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s