Most analysts had expected the producer cartel to maintain formal targets at its meeting in Vienna, although some had suggested they could tighten compliance in order to help stem a near 30 percent slump in oil prices since July.

US crude for October delivery was up 54 cents at US$103.80 a barrel by 0147 GMT, reversing earlier losses of more than US$1 a barrel after OPEC decided to trim its production ceiling to 28.8 million barrels per day (bpd).

London Brent crude rose 46 cents to US$100.80 after briefly dipping below US$100 for a second day. Prices hit their lowest in five months on Tuesday.

OPEC President Chakib Khelil said that he still saw surplus oil supply building on the market by the end of the year and increasing in the first months of 2009.

"OPEC is basically cutting the amount which Saudi had increased. Oil prices jumped initially after the news but we are not surprised by the amount of the cut. I don't think the cut can actually stop the current downtrend in the oil market," said Susumu Ogasawara, a manager at Ace Koeki Co Ltd in Tokyo.