OPEC members met on Monday to discuss production for February, which Russia proposed to be increased by 500,000 bpd. However, most members disagreed on this, so as a result, the negotiations deadlocked and continued on Tuesday.

Riyadh insists on raising production volume, while Saudi Arabia, on the contrary, strongly wants a decrease in output.

To add to that, at the time of the negotiations, demand for gasoline was actually deteriorating, according to Amrita Sen, co-founder and director at Energy Aspects.

News also emerged that Iran hijacked a South Korean-flagged oil tanker in the Strait of Hormuz, the latest in a series of shipping incidents in the Persian Gulf.

In any case, an agreement was reached on Tuesday, and it was to cut supplies over the next two months, with Saudi Arabia reducing more output than other countries.

In particular, Saudi Arabia will reduce output by more than 400,000 bpd in February and March, and this will offset the combined 75,000 bpd increase that Russia and Kazakhstan will have.

The rest of the members, meanwhile, will maintain their current production volumes.

This means that there will be less supply in the global market than traders had anticipated. But nonetheless, it gave most OPEC members what they wanted, that is, the additional price support that Saudi Arabia is seeking and the production boost that Russia has pushed for.