For those of us who were dying for relief from record high gasoline prices this summer, the recent drop in oil prices comes as great news, but this is not the case for everyone. OPEC, which supplies the world with roughly 40% of its oil, would like to see prices rise higher again, and today gave a clear sign that larger than expected production cuts are on the horizon.

In an interview today, the President of OPEC, Chakib Khelil, stated that a consensus had been reached for cuts at the next meeting of the oil cartel. The next scheduled meeting is on December 17, and according to Khelil, the market will be surprised.

Khelil stated that the he felt the best way to get a quick boost in oil prices is to shock the market, and he felt that the upcoming production cuts would be able to do just that. While he did not indicate exactly how large the production cuts would come, he left no doubt that they will be substantial.

"The stronger the decision, the faster prices will pick up," Khelil said.

Oil had a fantastic day, picking up nearly $3 in today's session. Could we finally be heading back into a bullish oil market? Cold weather and rumored OPEC cuts are definitely painting just such a picture.

It has definitely been a long time since we have seen such a strong one-day move for the precious crude as we did today with oil prices climbing $2.77 to $56.78. We even briefly saw prices crest over $57 for a short period this afternoon.

Two main factors were at play today. The first being cold weather across America, and the second being more production cut rumors coming from OPEC.

This winter has definitely been a warm one. Cold winter weather took its sweet time arriving and didn't really start to impact most of America until about a week ago. The long-awaited arrival of winter has had the effect of boosting prices and it definitely showed up just in the nick of time. Last week we were wondering if oil was going to be able to use the psychological $50 barrier as support, and now it looks like we could be testing resistance up at $60. What a difference a week makes.

There has been a lot of attention paid to OPEC lately as oil prices have sold off so sharply over the last couple of months. Many analysts have been wondering if the 11 nation group would call an emergency meeting to discuss the possibility of cutting production ahead of their next regularly scheduled December session. Last week both Nigeria and Venezuela announced they would cut back on their production which left us wondering whether this was a desperate attempt on their behalf, or possibly a sign of more to come.

After last week's cuts from Nigeria and Venezuela, I stated my view that the only way any cuts would be able to have a substantial effect on the price of the precious crude would be if we started to see pullbacks from some of the larger OPEC nations. Well, today we have the first sign of such production cuts as OPEC now plans to cut back 1 million barrels a day. Of this, 300,000 barrels are being reduced from Saudi Arabia. An OPEC governor stated that these cuts would be made effective as soon as possible.

So far OPEC has not made any concrete plans to meet to discuss any further cuts. But should today's actions not have the desired result of stabilizing prices, don't be surprised if the group doesn't move quickly in the weeks ahead. It is apparent that OPEC has said enough is enough and will now start to do whatever they have to in order to protect oil's price.