SBS World News Radio: Global oil markets have rallied after the world's largest oil exporters agreed to cut output for the first time in eight years by 1.2 million barrels a day.
Meeting in the Austrian capital, Vienna, the 14 member countries of OPEC agreed to the first supply cut in eight years.
Qatar's Energy Minister and OPEC president, Mohammed Bin Saleh al-Sada said markets need to be rebalanced, and that non-OPEC members, too, will be expected to reduce production, too.
"We have been able to reach an agreement. This agreement is out of the sense of responsibility for OPEC member countries, for non-OPEC countries, for the general wellbeing and the health of the world economy."
From January the 1st next year, producers will reduce their output by 1.2 million barrels a day to 32.5 million barrels.
The decision to cut supply had been hindered by rivalry between Saudi Arabia, and OPEC's top producer, Iran.
But Iran emerged as the major winner from the deal, with Saudi Arabia's Oil Minister, Khalid Al-Falih, saying Iran would now be allowed to increase its production to pre-sanction levels.
"We have agreed to a waiver from a cut to Iran in recognition of the impact of sanctions on their economy and their industry.
One nation not so happy was Indonesia, which suspended its membership of OPEC rather than agree to its share of cuts.
But OPEC president Mohammed Bin Saleh Al-Sada said it's a temporary measure.
"They (referring to Indonesia) are not withdrawing, they are suspending their membership and it's mainly because they are a net importer. And they think that they will face difficulty in participating in the unanimous agreement of OPEC decision."
The oil price surged with demand in the 2000s reaching a record price in 2008 before the financial crisis took its toll.
The price then recovered, steadily increasing to around 100 US dollars a barrel before a dramatic crash in 2014.
This year, the price dipped below 30 US dollars a barrel.
But here, the new year could well be a more expensive one with fears that petrol prices could leap as much as 10 cents a litre .
Craig James, Chief Economist at Comsec, is watching for the effects here.
"I think if we're going to see an increase it will a matter of a couple of cents rather than anything else. We've got to watch the situation fairly carefully. Because if we do see the oil price which is sitting round about $51 a barrel at the moment. If we see it marching higher towards $60 and above their will be an implication for motorists."
