Oil prices soar as non-Opec countries agree cuts to production

The price of oil surged on Monday morning following news over the weekend that a group of non-Opec countries have agreed to cut production.

Brent crude jumped to 56.80 US dollars a barrel, up over 4% on the day and the highest since July 2015.

Eleven countries including Russia, Mexico, Azerbaijan and Oman struck a deal to cut output by a total of 558,000 barrels a day.

The agreement builds on the 1.2 million barrel per day cut agreed by Opec earlier this month.

"Make no mistake about it - this historic agreement is a game changer. Although the crude oil rally has already started at the end of last month when the Opec first announced the deal, I think there is plenty of fuel left in this rally.

"Admittedly, after a big gap we may see a retracement of some sort in prices now but ultimately the fundamentals still point to higher levels going forward," according to Fawad Razaqzada, technical analyst at Forex.com.

The market has been in flux over the past two years, with oil prices falling as Opec refused to cut production in the hope that it would hit demand for rival US shale.

However, in what could be another boost for oil prices Saudi Arabia, which heads the cartel, has signalled that it could make even deeper production cuts.