Oil prices have rocketed after a group of non-OPEC countries agreed to huge cuts in crude oil production. The move also saw the stocks of major energy firms rising sharply during trading on stock exchanges in Asia.
Oil prices jumped to their highest level in a year on Monday after OPEC and non-OPEC producers agreed to cut their daily output considerably in a bid to ease a protracted global supply glut.
The agreement between OPEC and a number of other oil-producing nations including Russia was the first joint action since 2001, following more than two years of low prices that strained many governments' budgets.
Brent crude for February deliveries rose 5 percent to $56.94 (53.72 euros) per barrel, while US crude spiked a similar amount to $54.07 (51.02 euros) per barrel in early Asian trade before trimming earlier gains.
Rising 'reflation' expectations
Eleven non-OPEC nations had said they would pump more than half a million fewer barrels a day from next month which would contribute to the Organization of the Petroleum Exporting Countries' own output cut initiative unveiled on November 30.
"This is a very powerful message that producers want to balance the market higher," IG market strategist Chris Weston told the AFP news agency. "As a statement of intent, this is about as bullish as it gets."
The spike in oil prices came in the wake of a renewed focus on inflation. The recent developments look likely to help the European Central Bank come closer to its own inflation target of little under 2.0 percent for the 19-member eurozone. So far, the bloc's annualized inflation rate to November stands at only 0.6 percent.
hg/jd (dpa, Reuters, AFP)