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Oil is rallying after OPEC reportedly strikes a deal to raise production

Gina Heeb
Khalid al-Falih opec

Heinz-Peter Bader/Reuters


Oil prices rose more than 3% Friday after OPEC reportedly reached a deal to ease supply cuts that have been propping up prices for nearly two years.

West Texas Intermediate rose 3.33% to $67.99 a barrel at 10:50 a.m. ET. Brent, the international benchmark, was up 1.48% to $74.49 a barrel. 

Bloomberg reports that OPEC, which is meeting Friday and Saturday in Vienna, said the cartel will gradually raise output beginning in July by about 600,000 barrels per day. The increase translates to a 1 million barrel per day adjustment on paper, as some countries won't be able to meet the quota due to supply disruptions. 

Analysts had expected an increase of between 300,000 and 800,000 barrels per day, noting discord among members on whether to lift supply constraints at all. Saudi Arabia and Russia have been pushing for an increase, while Iran has said it would veto a proposal for that and has lobbied other countries to do the same. 

The move comes amid soaring crude prices and the risk of output disruptions in several member countries, including Venezuela, Iran and Angola. Saudi Arabia Energy Minister Khalid al-Falih has warned the world could face a supply deficit of as much as 1.8 million barrels per day in the second half of the year. 

Brent is up 61% over the year. 

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