OPEC struggled to reach the deal, just as oil prices were set to head lower, due to reduced demand from the refining industry. Each year, during the switch over to winter fuel production, industry demand drops as refineries undergo maintenance. That is known as the "shoulder season," and the market had been bracing for another decline in prices during it.
OPEC's surprise ability to take action also helped boost the organization's relevance again, after it had been written off by many market players. Oil prices immediately surged more than 5 percent Wednesday after Reuters reported from Algeria that OPEC members agreed to cut output for the first time since 2008. West Texas Intermediate was trading at just about the same level Thursday, close to $47 per barrel. Without a deal, analysts had said oil could plunge to $40 or lower.
"I think the price will wobble, but it certainly keeps more support than walking away with nothing. What I think is this will be a process. This isn't even an official OPEC meeting, and it buys them time," said Daniel Yergin, Vice Chairman of IHS. "It's them negotiating to negotiate."