Iraq announced that it will fully cut oil production this month, and agreed on details on how to compensate for its unfulfilled task in May.

According to delegates, the agreement was finalized at the recent OPEC + meeting, and it gave additional confidence that the cuts will ultimately help the oil industry since demand is now gradually recovering.

The earlier agreement of OPEC and its allies last month, which was to reduce oil production by 1.26 million, is set to be completed this coming months.

"OPEC takes its task very seriously," said Ben Luckock, co-head of Trafigura. "Performance will be better. The agreement between the countries at the last meeting was taken very seriously, and no one would like to be a fraud at the next OPEC + meeting, "Luckock said

Meanwhile, Prince Abdulaziz bin Salman of Saudi Arabia said that the OPEC + is on the "right track" to restore balance in the global oil market, but it's path still has a long way to go. He said that the next two weeks is "critical" for OPEC +, as it will reveal if all countries are sticking to the agreed cuts in oil production.

This week, the Energy Information Administration released a data which showed that last week, production fell to just over 10 million barrels per day. This is due to the fact that the number of drilling rigs for oil production has fallen by 72% over the past 14 weeks.

Other news on the oil market:

The accumulation of oil tankers off the coast of China is increasing, and ships have to wait

longer to unload their cargo due to lack of storage space on land.

In Venezuela, oil revenues are declining, exacerbating the growing instability of the regime of Nicolas Maduro.

Meanwhile, Total SA, Europe's largest oil refinery, attacked the North Sea crude oil market, as demand for fuel is increasing but the amount of cargo available from nearby regions is decreasing.

In line with this, UBS Group AG expects a shortage in the market in the second half of this year until 2021.