Opec and its partner nations agreed to introduce record production curbs to support global prices during the coronavirus pandemic.
About 9.7 million barrels, or about 10 per cent of global supply, will be removed from the market for two months, with the cuts being phased out gradually over two years, reports say.
Saudi Arabia's King Salman, Russian President Vladimir Putin and US leader Donald Trump welcomed the outcome of the meeting in a joint phone call, Saudi state news agency Spa said on late on Sunday.
The three leaders stressed the need for oil-producing countries to continue to fulfil their responsibilities to stabilise oil markets and support the global economy.
In a call between Mr Trump and Saudi Crown Prince Mohammed bin Salman, the two welcomed the outcome of a meeting to cut oil output amid the consequences of the coronavirus outbreak and in line with the aspirations of the markets.
Iraq's Oil Minister said that the deal would help to stabilise the market.
Thamer Al Ghadhban said that the "massive oil cut deal will help to lower oil inventories and boost prices".
Brent crude prices dropped by almost 70 per cent from recent highs of $68.71 per barrel in January to $22.71 at the end of last month.
This was after the expiry of an earlier agreement between members of the Opec+ alliance, which removed 1.7 million barrels per day from the market.
Producers then began increasing supply in a battle for market share at the same time as demand collapsed because of travel restrictions imposed due to the coronavirus.
But prices bounced back this month on the prospect of a new deal after the intervention of US President Donald Trump, who had threatened to impose oil tariffs on global producers if an agreement were not reached.
Brent crude closed at $31.48 on Friday, down 4.1 per cent as uncertainty grew over the prospects of the deal.
Opec Secretary General Mohammed Barkindo had told the opening of the video conference on Thursday that the effect of the coronavirus on demand meant that the energy market's fundamentals were "horrifying".
"The expected excess supply volumes on the market, particularly in the [second quarter of 2020], are beyond anything we have seen before, " Mr Barkindo said.
He had said oil demand was expected to contract by 6.8 million bpd in 2020 as opposed to a forecast at Opec's meeting in early March of an increase of 100,000 bpd.
Demand for the second quarter alone is expected to contract by 12 million bpd, Mr Barkindo said.
FGE in London has forecast a 24 million bpd decline in oil demand this month, whereas Swiss bank UBS expects a fall of 20 million bpd this quarter.
