The Organization of Petroleum Exporting Countries, OPEC, on Thursday extended the cuts in oil output by nine months to March 2018, as the group battles a global glut of crude.
The decision was taken after delegates from member and non-member nations met in Vienna, Austria to deliberate on the way forward after seeing revenues from crude drop sharply in the past three years.
The cuts are going to be shared by a dozen non-members led by top oil producer Russia, which reduced output in tandem with the OPEC from January.
Global oil cuts have helped push crude prices above $50 a barrel in 2017, which has helped member-nations sustain their revenues, as majority of them rely heavily on energy revenues.
The price rise this year has spurred growth in the U.S. shale industry, which is not participating in the output deal, thus slowing the market’s rebalancing with global crude stocks still near record highs.
In December, OPEC agreed its first production cuts in a decade and the first joint cuts with non-OPEC, led by Russia, in 15 years. The two sides decided to remove about 1.8 million barrels per day from the market in the first half of 2017, equal to 2 percent of global production.
Nigeria and Libya were again excluded from this latest cuts as their output remained curbed by unrest, Saudi Energy Minister Khalid al-Falih said.
Falih also said Saudi oil exports were set to decline steeply from June, thus helping to speed up market rebalancing.