Energy ministers from OPEC and Russia say they have agreed on a method to monitor compliance of a deal to slash oil output designed to eliminate a two-year glut and boost market prices.
Saudi Arabian Energy Minister Khalid al-Falih said on January 22 that producers had already cut supply by 1.5 million barrels a day -- more than 80 percent of the total target.
Russian Energy Minister Aleksandr Novak was equally jubilant.
"The deal is a success," he said. "All countries are sticking to the deal ... results are above expectations."
Saudi Arabia, Kuwait, Qatar, Algeria, and Venezuela met in Vienna with non-OPEC nations Russia and Oman to hammer out a method to verify that the 24 countries that signed a December 10 deal were complying with pledges to slash output.
Oil prices have risen about 20 percent since the December agreement. Brent crude rose 2.5 percent to $55.50 a barrel on January 20 ahead of the Vienna gathering, about double what they were a year ago.
As part of the monitoring mechanism, Novak said a committee would assess data supplied by the countries along with figures from various international organizations and that nothing short of total compliance would be accepted.
Past agreements have often failed, as some countries -- seeking to maintain market share and revenue -- have not followed through on pledges.
"We started to trust each other better, which is just as important as the market rebalancing," Novak said. "One year ago, not many believed in the success of this initiative."
Novak said his country was ahead of schedule, having already cut output by 100,000 barrels a day. Russia said it plans to slash output by 300,000 barrels a day by April or May. Russia's output is reportedly 11.1 million barrels a day.
Production by OPEC countries fell 220,900 barrels a day to 33.085 million in December, the group said. It has agreed to reduce output to 32.5 million barrels a day.
Still, cutting the global glut will be difficult, as other producers, including the United States, are not a part of the agreement. OPEC members Nigeria and Libya, both suffering production difficulties, were exempted from the cuts.
With reporting by Bloomberg, Reuters and The Wall Street Journal