Oil producing nations fail to reach an agreement, say they need ‘more time’
Attempts by some of the world’s biggest oil producers to freeze output ended without a deal on Sunday night, after Saudi Arabia insisted Iran should be part of any agreement.
Talks in Doha aimed at achieving the first global oil deal in 15 years, which had appeared to be on course earlier in the day, broke up late on Sunday night as ministers failed to overcome opposition from Riyadh, which had hardened its stance in recent days.
The failure to reach an agreement risks setting off another drop in the oil price, with tensions between Saudi Arabia and its regional rival Iran proving too great to overcome.
Mohammed Bin Saleh Al Sada, Qatar’s energy minister, said: “We all need time for further consultation.”
Delegates said Saudi Arabia had in effect torn up an earlier draft of the deal as it decided it could not be party to an agreement that would give Iran any leeway. Tehran had refused to join the freeze as it rebuilds its oil exports after years of sanctions.
Iran did not send a representative to the meeting, which was attended by major non-Opec producers such as Russia and Mexico, alongside countries from the cartel. Together they represent almost half of global crude production.
“The whole world was waiting for this to happen. We were all positive this morning,” said one delegate before the end of the meeting. “If it doesn’t, this is not good. If there is not a positive statement the price of oil will be down $5 [a barrel] tomorrow.”
Oil prices have already rallied from below $30 a barrel in mid-January to $43 at the end of last week, partly due to the plans for an output freeze that were led by Qatar, Russia and Saudi Arabia.
A second draft that had been circulating last night suggested a freeze would only take place if “all major exporting nations” were unanimous on a deal.
Saudi Arabia said in late 2014 that it did not care if oil prices slid to $20 a barrel, but it had recently indicated a shift in its approach amid pressure on the country’s finances.
A senior Opec delegate said last month that the Saudis would comply with an output freeze, even without Iran’s involvement. But the country’s deputy crown prince, Mohammed bin Salman, said last week that Saudi Arabia would not sign up without Tehran.
“We are very very disappointed,” said Falah al Amri, the Iraqi representative. “This will effect the [oil] price and our earnings. We wanted a deal”
Courtesy: next.ft.com
Ego clash between Saudis, Iranians and Russians is the main cause of instability in the oil prices.
Cutting output mean, more job cuts as they don't need more labour....how is this beneficial to Qatar and those in the industry here.
Why will it hurt the Non-OPEC producers? Does the OPEC support its members financially?
There will be some benefits - this drop will hurt the non opec and shale oil producers harder ...
And here are the results of the meeting in Doha: "Falling oil prices hit Asian stock markets after a meeting of oil producers ended without a deal on freezing output.
The international oil benchmark Brent was down by more than 5% to $40.87 a barrel. US crude futures fell 5.5% at $38.16 a barrel." [BBC]
Good job!
As expected....Greed! Where is MM's joys as he was soooo positive that this will have a great outcome!
Iran's demands are just. This is just Saudi arrogance & American advice
Nobody believes that they will come to a common solution. The oil price lost 1.7% today.
They are not "freezing crude output". They are trying to put a cap on it