OPEC agrees to cut oil output for first time since 2008; prices surge

The Organisation of Petroleum Exporting Countries (OPEC) has agreed to cut production by 750,000 barrels a day, citing a delegation member.

The surprise news triggered an immediate spike of more than 5% in crude prices, as markets had expected the Algiers meeting to end without agreement.

In London benchmark Brent North Sea crude for November delivery rose $2.72 to $48.69, while in New York a barrel of West Texas Intermediate (WTI) was up $2.38 to $47.05.

OPEC members, whose countries produce 40% of the world's crude oil, agreed to cut their output to 32.5 million barrels per day, Bloomberg said citing a delegation source who requested anonymity.

An informal OPEC meeting opened in Algiers earlier today to discuss a possible freeze in output by the cartel, with the aim of raising prices which have fallen by more than half since mid-2014.