After Opec+ agreed to reduce crude supply, oil prices continued to rise.

After Opec+ agreed to tighten global crude supply with a deal further to cut output by approximately two million barrels per day, the most significant reduction since 2020, oil prices surged for a fourth consecutive day on Thursday, with Brent reaching a three-week high.

By 02:34 GMT, December Brent crude futures had gained 22 cents, or 0.2%, to $93.59 per barrel, following a 1.7% increase in the previous session.

The price of a barrel of US West Texas Intermediate (WTI) oil futures for November delivery increased by 22 cents, or 0.3 percent, to $87.98 on Wednesday, adding to Tuesday's 1.4 percent gain.

This agreement between the Organization of Petroleum Exporting Countries (Opec) and its allies, which includes Russia, is known as Opec+. It comes before the European Union imposes a ban on Russian oil, which would further tighten supplies in an already overpriced market.

Since not all Opec+ nations are fulfilling their production goals, the actual cut will be less than the 2 million BPD drop agreed upon at the summit.

The actual production drop will be around 1m to 1.1m BPD, according to Saudi Arabia's Energy Minister Abdulaziz bin Salman, who blamed higher interest rates in the West and a faltering global economy for the decision.

The Joe Biden administration has criticized the agreement as "shortsighted." The White House has stated that Vice President Biden would continue to evaluate whether or not to release additional strategic oil inventories to reduce costs.

While presumably referring to legislation that might expose members of Opec to antitrust charges, the White House stated that it would engage with Congress on other routes to weaken Opec and its allies' dominance over energy pricing.

According to a report published by Citi analysts, the agreement's eventual market impact would depend on how long it lasted. Production cutbacks would keep global supplies low for longer and tighten markets in 2023. The Declaration of Cooperation between Opec and allies was extended until the end of 2023.

RBC Capital analysts predict that Saudi Arabia, the world's largest exporter, will provide more than half of the one million BPD supply drop.

On the other hand, Russian Deputy Prime Minister Alexander Novak indicated on Wednesday that Russia might reduce its oil supply in response to price limitations imposed by the West in response to Moscow's activities in Ukraine.

News of a drawdown in US oil reserves buoyed prices last week. The Energy Information Administration reported that crude oil stocks fell by 1.4 million to 429.2 million barrels on September 30.