Oil prices had been under pressure earlier in the session as profit-taking and concern over a larger-than-expected build in US crude stocks outweighed news of the Russia-Saudi deal. That evidence is finally starting to emerge in Latin America, Asia and even the US, where the Energy Department said Wednesday that oil production fell below 9 million barrels a day for the first time since September 2014.
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Saudi Arabia agreed to make its final decision on freezing output without Iran’s participation in the deal, which is backtracks on earlier statements insisting on the Saudi decision being dependent on Iran freezing output.
If an agreement is reached this weekend, McKnight said the price of oil could settle at about $45 a barrel. BofA, which maintains its projection that oil would trade above $50 a barrel next year on average, said it did not see prices plunging into mid-to-low $30s.
What would be a momentous agreement among the 15 or so oil producers – representing some 75% of global output – in Doha is far from guaranteed, however.
Negative sentiment also came from a report that Iran would only send a government representative and not its oil minister to the producer gathering.
This somewhat offset last week’s 0.620 million barrel build. On Wednesday, the U.S. Energy Information Administration will release its inventory report for the week-ending April 8.
“Forget about this topic”, al-Naimi told the paper, when asked about any possible reduction in his country’s crude output.
The largest producers, including Saudi Arabia and Russian Federation, are scheduled to meet to finalise a deal reached in February to freeze oil output at January levels aiming to bolster oil prices.
“Key OPEC member Iran has been raising output since nuclear-linked Western sanctions were lifted in January and has signalled it will not join the freeze calls”. Gasoline fell by 4.2 million barrels to 239.76 million, compared with an analyst forecast for a 1.4 million-barrel draw.
Saudi Arabia raised its oil output above 10 million barrels a day past year in a bid to gain market share.
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The main reason was lower expectations for crude oil production from China’s onshore mature fields and further declines in the United States, where shale oil producers have proved surprisingly resilient to the lower oil price.
