OIL NEWS.

OPEC, Russia and other oil major producers reached an unusual agreement on production quotas on Tuesday, with Saudi Arabia committing to reducing its oil production by one million barrels a day and Russia and Kazakhstan winning relatively modest production increases. The effect will be an overall reduction in oil production. The news pushed prices up more than 4 percent, reaching levels not seen since February. Brent crude rose past $53 a barrel, and West Texas Intermediate exceeded $50 as traders welcomed the Saudi willingness to give up some barrels in an effort to stabilize the market. The difficulty in reaching consensus at the meeting of the OPEC Plus group appeared to show that cooperation between Saudi Arabia, the de facto leader of the Organization of the Petroleum Exporting Countries, and Russia is once again under considerable strain. That tension could be a harbinger of difficulties in restraining production in the coming months. Finding that they were unable to head off Russia’s demand for a production increase, Saudi Arabia appears to have largely given in to preserve at least a semblance of unity. Instead of letting everything fall apart, the Saudis let the Russians have what they want,” said Bhushan Bahree, an executive director at IHS Market, a research firm. Russia will now be permitted to raise production by 65,000 barrels a day in February and by another 65,000 a day in March, bringing output to over 9.2 million barrels a day.