Oil prices continued their rise on Wednesday, reaching highs since late February 2020, a day after the announcement of a major cut by Saudi Arabia in its oil production while the rest of OPEC+ will increase its own only marginally in the coming months.

The barrel of North Sea Brent for delivery in March gained 1.49% or 80 cents from Tuesday's close at $54.30. In London in the morning, it had touched $ 54.63, a price more seen since February 26, 2020.

The U.S. barrel of WTI for the month of February climbed 1.40% or 70 cents, to $ 50.63, a high since the end of February.

"Oil prices are rebounding after the unexpected results of the OPEC+ meeting," said Carlo Alberto De Casa, an analyst at Activtrades.

After two days of talks, members of the Organization of the Petroleum Exporting Countries (OPEC) and their partners finally reached a compromise on Tuesday, allowing only Russia and Kazakhstan to slightly increase their production of black gold in the first quarter.

The volume voluntarily withdrawn from the market since spring 2020 by this so-called OPEC+ alliance will increase from 7.2 million barrels per day (mbd) in January to 7.125 mbd in February and 7.05 mbd in March, the cartel announced at the conclusion of their first ministerial summit of 2021.

But "the real surprise was the announcement by Saudi Arabia of a voluntary reduction of one million barrels per day that will be implemented over the next two months," added the analyst of Activtrades, enough to make the markets "enthusiastic".

"Rather than being taken for what it is – a sign of weakening demand – the Saudi surprise has caused oil prices to skyrocket," said PVM's Stephen Brennock.

The prices of the two reference contracts had already appreciated by nearly 5% on Tuesday.

The rise was also fueled by data released Wednesday by the U.S. Energy Information Agency (EIA) which shows that U.S. commercial crude inventories fell by 8 million barrels (MB) for the last week of 2020, more than analysts expected.