At the meeting in Doha, oil producers that supply almost half of the world’s output failed to reach a deal to curb their production after Saudi Arabia appeared to walk away from any agreement that didn’t include geopolitical rival Iran.
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Iran is against any freeze because its production in January remained well below historic levels as sanctions over its nuclear program had only just been lifted.
The focus of Nigeria’s shuttle diplomacy would be to convince Saudi Arabia and its arch foe Iran to agree on a deal. Possibilities of freezing oil production were also discussed as well as several scenarios regarding, when and who will implement this freezing, Dr Al Sada, who is also the President of Opec said.
A number of Asian markets closed at their highest levels for over a month overnight on the back of the stabilised oil price. “To put things in perspective four years ago when the average price of petrol was 142p and diesel was 148p, a barrel of oil cost $120 so fortunately we are long way from seeing those bad times again”.
Russia’s oil output may reach 540 million tons this year, Deputy Energy Minister Kirill Molodtsov told reporters. Saudi Arabia and other Gulf producers refused to cut production unless they could get a matching agreement from an Iran that hadn’t even bothered to attend the talks. This would support low oil prices in the middle of an oversupply situation.
Saudi Arabia’s decision to scupper negotiations on a co-ordinated oil output freeze in Doha on Sunday seems to confirm a significant shift in the kingdom’s oil policy.
April 18, oil prices dropped to under $40 a barrel, as anticipated because of the outcome of the April 17 meeting.
Oil prices rose against the backdrop of news from Kuwait, where the oil sector workers are on a termless strike. Oil investors have been cheered recently by news that USA shale production is beginning to decline. It reduced its output by more than 50%. Well, now the supply is up and its higher than the demand, so prices are low.
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Addressing newsmen after the protracted meeting of OPEC and non-OPEC oil producers held under the aegis of Oil-Producing Countries Ministerial Meeting in Doha, Qatar, Dr. Kachikwu stressed that OPEC must work at achieving a workable consensus on the issue by bringing everybody on the negotiating table.
