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OPEC and allies agreed to lower collective crude output by an additional 500,000 bpd from January 1, 2020, on top of the existing deal. Saudi Arabia will take most of the cut and add a voluntary 400,000 bpd, bringing total reductions to 2.1 million bpd.
The deal will be reviewed in early March 2020.
Total cuts of 2.1 million bpd remove a significant share of supply, supporting crude prices and the energy costs behind diesel, freight and fertilizer.
After 438 past bullish policy events, Crude Oil (WTI) moved a median +0.9% over 5 sessions (61% higher; middle half -2.2% to +4.6%), and +2.0% over 20.
After 442 past bullish policy events, Crude Oil (Brent) moved a median +1.4% over 5 sessions (60% higher; middle half -2.0% to +4.9%), and +2.1% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
