OPEC and its allies agreed on Friday to lower their collective crude oil production by an additional 500,000 barrels per day (bpd) for the first quarter of 2020.
The additional cuts to oil output will be implemented beginning Jan. 1, 2020 and will be added to the current production deal already in place.
Dubbed OPEC+, the Saudi-led OPEC and Russia-led non-OPEC countries had agreed in December 2018 to lower collective oil production by 1.2 million bpd until June 2019 and later extended this deal until the end of March 2020.
Saudi Arabia will undertake most of the burden of 500,000 bpd by lowering its individual output by 167,000 bpd, Energy Minister Prince Abdulaziz bin Salman told reporters after the three-hour OPEC+ meeting in Vienna.
The kingdom will also voluntarily lower its crude oil production by an additional 400,000 bpd, which will carry the total of OPEC and non-OPEC cuts to 2.1 million bpd starting from Jan. 1, he added.
Russia's condensate oil production, which has lately become a topic of controversy, will no longer be calculated inside the country's crude oil production quota, Russian Energy Minister Alexander Novak announced in the press conference.
As part of the 500,000 bpd of production curb, Russia will undertake around 70,000 bpd of it, raising the country's oil output cut from 228,000 to 300,000 bpd, Novak added.
The latest production cut deal will be reviewed at the beginning of March 2020 based on market conditions and oil prices, the ministers said.
After the decision of deeper OPEC+ cuts, crude prices rallied in the global oil market.
International benchmark soared to $64.72 per barrel to post a 2.5% gain at one point, while American benchmark West Texas Intermediate reached as high as $59.69 a barrel for a 2.9% jump.