OPEC agrees to cut output by 1.2 million barrels a day

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Vienna: OPEC members and 10 other oil producing nations agreed Friday to cut output by 1.2 million barrels a day in a bid to boost prices. Energy ministers reached the deal — which takes effect from January 1 but has already sent prices surging on oil markets — after two days of talks at OPEC headquarters in Vienna. “We’ll cut 1.2 million bpd total,” Iraq´s Oil Minister Thamer Abbas al-Ghadhban told reporters after a meeting in Vienna. He said the amount — equivalent to just over one percent of global production — would comprise an 800,000 bpd reduction by the 14 members of OPEC and 400,000 by the 10 non-cartel partners, including Russia. OPEC and its partners, which together account for around half of global output, agree that a glut in the market had led to oil prices falling by more than 30 percent in two months. Friday’s deal does not however include Iran, which had demanded an exemption from any production cuts to take into account the effects of punishing US sanctions on its energy sector. “Officially Iran is exempted from this resolution,” UAE Oil Minister Bijan Namdar Zanganeh said.