The Organisation of the Petroleum Exporting Countries reached the deal on Sunday after a short meeting in Vienna, despite worries among consumer nations about inflated fuel costs.
Gone are the concerns that dominated in Opec last year about the impact of rising crude prices on the world economic growth that drives demand for its oil.
With inflation in the big economic powers in check and low interest rates still generating above trend growth, Opec ministers see no reason for cheaper oil.
Several in the 11-member group, including Saudi Arabia, have said they see no significant slowdown in world growth, pointing in particular to forecasts for Chinese oil demand to increase sharply again this year.
"We think the high price will not effect the global economy. There won't be a strong negative for the economy," said Kuwait's Opec President Shaikh Ahmad al-Fahd al-Sabah
Al-Sabah: High prices will not
affect the global economy
Opec now appears prepared to defend oil prices at a floor of about $40 a barrel for US crude, or $35 for an index basket of cartel crudes - a $10 increase on the official target it set in 2000.
At Friday's US close of $47.15 a barrel, prices were too high for OPEC to justify arranging cuts now for implementation at the start of the second quarter, when seasonal demand ebbs.
"We have to wait until the second quarter of this year to know exactly where the price indicator will head," said Shaikh Ahmad. "But I believe that $35 is a suitable price as an average price for the Opec basket of crudes."