RIYADH: Crude oil prices gained up to 6% in early trade on Monday after OPEC+, a group of oil-producing nations, unexpectedly announced plans to reduce their combined output by 1.15 million barrels per day.

Oil producers, which account for about 50% of the world's oil supply, have decided to extend their output cuts through May until the end of 2023 in an effort to stabilize markets, according to a series of announcements made on Sunday night.

Saudi Arabia announced a production reduction of 500,000 barrels per day, while Baghdad announced a production reduction of 211,000 bpd.

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Production will be cut by 144,000 barrels per day (bpd) in the UAE, 128,000 in Kuwait, 78,000 in Kazakhstan, 48,000 in Algeria and 40,000 bpd in Oman.

As of 9:00 GMT on Monday, US West Texas Intermediate crude futures were up 5.6% at $79.90 a barrel, while international benchmark Brent was up more than 5.5% at $84.30 a barrel.

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Russia had already voluntarily reduced oil production by 500,000 bpd in March in response to an oil price cap imposed by Western countries, which it claimed would eventually reduce supply and create uncertainty in the global market. But on Sunday Moscow announced it would extend its cuts through the end of the year, according to OPEC.

Moscow is confident the action will help stabilize crude oil prices, which have declined sharply on concerns the Western banking crisis will reduce worldwide energy demand.

The action was described by the Saudi Ministry of Energy as a "precautionary measure aimed at supporting the stability of the oil market".

The price of crude oil supplied by the kingdom of Saudi Arabia should not be capped, the country's energy minister Prince Abdulaziz bin Salman warned Western nations last month.

He said that any attempt to do so would result in suspension of sales and curtailment of production.

Washington was disappointed with the decision because it goes against US demands that oil producers increase their output and lower prices.

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President Joe Biden also traveled to Riyadh last July in an effort to deliver the petition directly to Crown Prince Mohammed bin Salman.

"Given the current market situation, we do not think a cut is appropriate at this time and we have made that clear," a spokeswoman for the National Security Council told Reuters on Sunday.