Doha discussions dragged on for hours after scheduled conclusion as OPEC members debate Iran role
Update 2 p.m. Eastern: Bloomberg is reporting that the talks have wrapped up without agreement on a freeze. AP says OPEC members need “more time” before reaching agreement, hopefully at a meeting in June.
The Sunday OPEC meeting to discuss an oil production freeze has stalled over the Saudi demand that all members, including Iran, be bound by the agreement.
“A further recovery in oil prices would surely require outright cuts in global supply and increases in demand, which suggests that the next big move up will not take place until next year when the market should be much closer to balance,” Capital Economics told CNN.
Sixteen nations are meeting in the Qatari capital. The goal is to stabilize global oil markets after prices fell below $30/b before rising to the mid-forties in the past week.
Iran did not send representatives to the meeting and said it will not support an output freeze. Market sanctions against Iran were lifted after it agreed to limit nuclear ambitions. The Islamic state has said repeatedly that its goal is to resume oil production of over four million b/d and regain market share, as well as sell a crude oil inventory estimated to be as high as 50 million barrels.
Comments from Reuters’ sources:
“I am not sure you can call it a freeze,” one OPEC source said.
A senior oil industry source said: “The problem now is to come up with something that excludes Iran, makes the Saudis happy and doesn’t upset Russia.”
“If there is no deal today, it will be more than just Iran that Saudi Arabia will be targeting. If there is no freeze, that would directly affect North American production going forward, perhaps something Saudis might like to see,” said Natixis oil analyst Abhishek Deshpande.
Comments from Associated Press sources:
“We reached the conclusion that the Doha meeting is for those who want to sign the oil freeze plans, and if we wanted to have a representative at the meeting, it was to show our support of this project,” Oil Minister Bijan Namdar Zangeneh said, according to a report by the ministry’s SHANA news agency. “But since Iran is not going to sign this, there is no need for the presence of Iran’s representative at the meeting.”
Comments from Bloomberg sources:
“Discussions are at a very high level between the Saudis, Russians and Gulf countries,” over Iran’s output, Wilson Pastor, Ecuador’s governor to OPEC, said in a Bloomberg Television interview in Doha before the start of formal talks. “The general agreement is in place,” but there were some disagreements on the wording, including details yet to be finalized on monitoring the accord and a follow-up meeting, he said.