After two days of discussions, OPEC and its partners have agreed to continue to limit their oil production beyond February 1, pushing WTI back to the $50 a barrel mark.

Oil prices soared on Tuesday in response to the announcement of an OPEC + agreement to extend its production restrictions in a still uncertain international environment, against a backdrop of the resurgence of the coronavirus pandemic in the United States and in Europe.

The price of U.S. WTI light crude oil jumped 4.9% on Tuesday to approach $50 a barrel ($49.93) for the February Nymex futures contract, while North Sea Brent crude oil rose 4.9% on Tuesday. February maturity also took 4.9% to $53.60.

After two days of tense discussions, OPEC and its partners therefore agreed to continue to limit their oil production beyond February 1, when they initially intended to increase their pumping by 500,000 barrels per day.

On Monday, the meeting ended with a disagreement between Saudi Arabia and Russia on the level of crude production to be reached in February. But despite the reluctance of Moscow and Kazakhstan, Saudi Arabia and its OPEC allies have obtained that production targets are not revised upwards.

Unilateral drop in Saudi Arabia's production

In detail, the coalition of producing countries, which represents half of the world's crude oil production, decided to increase its production at the margin in February and March, the volume voluntarily withdrawn from the market increasing from 7.2 million barrels per day (mbd) at 7.125.

But Saudi Arabia unilaterally agreed to proceed with an additional unilateral reduction of 1 million bpd, enough to largely offset the 75,000 bpd increase for Russia and Kazakhstan.

Faced with the resurgence of the Covid-19 pandemic, which will weigh on demand for black gold at the start of the year, Saudi Arabia, leader of OPEC, did not want to raise oil production too quickly. alliance, in order to continue to support oil prices, which dropped 20% in 2020 in the face of falling global demand.