OPEC and non-member allies led by Russia have agreed to raise oil production by a million barrels per day. It can be regarded as a victory for Saudi Arabia and Russia, which had pushed to boost output to alleviate high prices.

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Saudi Energy Minister Khalid Al-Falih told reporters in Vienna that an agreement had been reached for a “nominal” production increase of one million barrels per day (bpd). In reality, production will rise only by 700,000 bpd as some OPEC members are unable to boost production at the moment.

Oil prices rose following the news, with Brent crude trading at $74.69 per barrel (+$1.65), while the US West Texas Intermediate gained almost $2, trading at $67.53.

The agreement is set to help increase supply in the oil market without creating a glut. “The effective increase in output can easily be absorbed by the market,” Harry Tchilinguirian, head of oil strategy at French bank BNP Paribas, told Reuters.

Iran, OPEC’s third-largest producer, was against the agreement at first since the country is facing export-crippling US sanctions.

Some analysts have said the production hike is not enough because of the US sanctions against Iran and Venezuela.

“It will be enough for now but not enough for the fourth quarter to address a decline in Iranian and Venezuelan exports,” said Gary Ross, head of global oil analytics at S&P Global, as quoted by Reuters.

“There isn’t a lot of spare capacity in the world. If we lose a million bpd of output from Venezuela and Iran in the fourth quarter, where will all these barrels come from? We are in for higher prices for longer,” he said.

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