OPEC and non-OPEC oil producers have reached an agreement to jointly reduce crude oil production, in an attempt to ease the global glut and strengthen low prices. This is the first deal between OPEC and non-OPEC producers since 2001, after nearly one year of internal discussions within the OPEC. Earlier in December 2016, the OPEC reached an agreement to cut crude oil production by 1.2 mb/d as of 1 January 2017 to 32.5 mbl/d. Saudi Arabia would cut its crude production by nearly 486 kb/d to 10.058 mb/d, while Iraq, the second largest producer among OPEC, will cut its production by 209 kb/d.
With this new agreement, non-OPEC producers agreed to curtail their output by 558,000 bbl/d, including a 300,000 bbl/d cut from Russia: Russia's production is expected to fall from 11,247 mb/d in October 2016 to 10,947 mb/d after six months. Smaller non-OPEC producers will also reduce their output : Oman announced a cut by 45,000 bbl/d and Kazakhstan will try to reduce its production by 20,000 bbl/d.
OPEC and non-OPEC producers taking part to the agreement account for around 55% of global oil production; their joint reduction of approximately 1.8 mb/d accounts for around 2% of global oil supply.