Crude Oil settled up by 8.48% at 3377 as OPEC has agreed its first limit on oil output since 2008 with Saudi Arabia accepting "a big hit" on its production and agreeing to arch-rival Iran freezing output at pre-sanctions levels. The source said the Organization of the Petroleum Exporting Countries had on Wednesday agreed on a proposal by member Algeria to reduce production by around 4.5 percent, or about 1.2 million barrels per day. Saudi Arabia would contribute around 0.5 million bpd by reducing output to 10.06 million bpd, the source said, while Iran would freeze output at close to current levels of 3.797 million bpd and other members would also cut production. The source added that OPEC had also suspended Indonesia from OPEC and hence the exact combined reduction was yet to be calculated. The meeting was still ongoing after around six hours of debate. Clashes between Saudi Arabia and Iran have dominated many previous OPEC meetings. But the tone changed on Wednesday with Iranian Oil Minister Bijan Zanganeh saying he was positive since Iran had not been asked to cut output. OPEC, which accounts for a third of global oil production, made a preliminary agreement in Algiers in September to cap output in an effort to prop up oil prices, which have halved since mid-2014. OPEC said it would exempt Iran, Libya and Nigeria from cuts as their output has been crimped by unrest and sanctions. Technically market is under short covering as market has witnessed drop in open interest by -28.25% to settled at 10867 while prices up 264 rupee, now Crudeoil is getting support at 3208 and below same could see a test of 3038 level, And resistance is now likely to be seen at 3468, a move above could see prices testing 3558.

Trading Ideas:

Crudeoil trading range for the day is 3038-3558.

Crude oil prices jumped more than 8 percent to a five-week high as OPEC has agreed its first limit on oil output since 2008.

OPEC agreed on a proposal by member Algeria to reduce production by around 4.5 percent, or about 1.2 million barrels per day.

The source added that OPEC had also suspended Indonesia from OPEC and hence the exact combined reduction was yet to be calculated.