A rare meeting of minds between OpeC and non-OpeC producers in Vienna on November 30 has quelled the simmering panic that has burdened oil producers since a supply glut pushed oil prices to a 12-year low at sub-$30 a barrel (bl) in January this year. Saudi arabia-led OpeC agreed to cut output by 1.2 million barrels a day (m b/d) from January 2017, which will limit the 13-member group?s output to 32.5m b/d. the cuts follow a record high production of 34.2m b/d in November. russia-led cuts by non-OpeC producers of 558,000 b/d will also start in January.

Most importantly, the collaboration that underpins the Vienna agreement is a welcomed break from the bickering and backroom talks that have long characterized the oil markets. the agreement marks the first cut made by OpeC since 2008 and the first deal including non-OpeC producers in 15 years. 