Will OPEC's decision to cut production affect consumers? l Inside Story

The U.S. exported more oil gasoline and other petroleum products than it imported in the last week of November. Katie Howell  E&E News

The U.S. exported more oil gasoline and other petroleum products than it imported in the last week of November. Katie Howell E&E News

Mazrouei said the exemptions mean that the cuts introduced by other member-states are "going to be a bit higher than just the average for every one".

The cartel and its partners agreed to remove 1.2 million barrels a day from the market, with OPEC itself shouldering 800,000 barrels of the burden.

The Organisation of Petroleum Exporting Countries (OPEC) and other major oil producers yesterday agreed to cut about 1.2 million barrels of oil to address falling oil price, which is now facing a record low of $63 a barrel. Although the cut is much higher than expected, that is why news of crude prices in the global market has increased by 5.4 percent. In New York last night Brent was...

For the US, its President, Donald Trump, has, for some time, been campaigning for increased oil production, despite the country's growing shale oil output capacity, which makes the country the world's largest oil producer in excess of 11 million barrels per day. But what made this agreement unusual is the prominent role played by Russian Federation, which is not an OPEC member.

Members of the Organization of countries-exporters of oil (OPEC) today, December 6, came to preliminary agreement on the reduction of oil production. The Energy Information Administration said the USA exported 3.2 millions barrels of oil during the week, and more than 5.8 million barrels of other refined products.

Friday's deal, however, has exempted Iran, along with Venezuela and Libya. OPEC was surprised and angered by Trump's about face on sanctions, but so too were US pipeline and oil producers.

The highly anticipated decision was delayed since Thursday pending the outcome of the dialogue between both groups on the ideal volume that would be adequate to help stabilise the market and strengthen crude oil price at the global oil market.

Speaking to reporters at the end of the session, Iran's Petroleum Minister Bijan Zangeneh expressed his satisfaction with the decision.

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After this news, crude prices in London climbed 5.4 percent.

"We continue to expect that slower economic growth will weigh on oil demand next year, which coupled with rapid growth in U.S. production, will put renewed downward pressure on prices", said Caroline Bain, an economist at Capital Economics.

In the week to November 30, however, the weekly U.S.net imports of crude oil and petroleum products were at minus 211,000 bpd-meaning that the USA was a net exporter of that amount, according to data from the EIA.

Russian Energy Minister Alexander Novak confirmed the combined output cuts of 1.2 million bpd, saying the market would be oversupplied through the first half of the year.

The sixth OPEC and non-OPEC ministerial conference is scheduled for Vienna, Austria, in April 2019.

"As long as a little producer like me can expect $50 or better, we can do fine; $50 works for me", said Harvey Howell, president of H.H. Howell Inc, a San Antonio, Texas, producer.

- Crude exports have established an all-time weekly high of 3.2mbpd, climbing up some 0.6-0.7mbpd from the past weeks.

Competition to Brent from US shale output has weighed on prices at a time when financial markets are anxious about the health of the global economy and the fallout of the US-China trade war.

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