OPEC agreed on Friday to curb its output by 1.2 million barrels per day, its first cut for more than two years, to halt a precipitous fall in prices.
The reduction, amounting to 4.3 percent of OPEC's September production, was deeper than anticipated and the biggest since January 2002. It trims OPEC output to 26.3 million bpd from November 1.
Some ministers said a further cut of 500,000 bpd could follow when OPEC next meets in Abuja in December, to address high fuel stocks in consumer countries, particularly the United States, and a projected drop in demand for OPEC oil in 2007.
U.S. oil rose 73 cents to $59.23 on the news, but later pared gains and was trading 44 cents higher at $58.94 a barrel by 0829 GMT.
In a statement issued after the meeting, OPEC expressed concern that oil supplies were far outstripping demand. "The over-supply situation and imbalance in supply/demand fundamentals have destabilized the market," it said.
Khelil said all 10 OPEC members subject to quotas would participate in the cut. Only Iraq, struggling to get its oil industry back on its feet after war and sanctions, was exempt.
(Reuters)