“Asking Iran to freeze its oil production level is illogical … when Iran was under sanctions, some countries raised their output and they caused the drop in oil prices”, Asali said.
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Iran reportedly indicated Wednesday it would not join a surprise agreement between Russia, Saudi Arabia and three other Gulf states to freeze their oil production at January levels to stabilize slumping crude prices.
“I share the consensus view that producers are unlikely to reach an agreement (on cuts), the rationale being the need to satisfy two conditions”, CMC Markets chief market analyst Ric Spooner said in Sydney.
“I’m pricing between $US35 and $US45 for Brent by summer, as we still have a daily surplus of up to 1.7 million barrels of oil to contend with”, said Phil Davis, an independent crude trader at PSW Investments.
Crude gained support after the American Petroleum Institute, an industry group, said US crude stocks unexpectedly fell by 3.3 million barrels last week.
But U.S. oil production has only slipped slightly in the face of drastically lower oil prices.
The Doha meeting could be a signal that oil-producing nations, including OPEC members, might eventually agree to an outright production cut to halt the 19-month slide in prices to their lowest point in more than a decade.
Many believe that the fact that major OPEC producers such as Saudi Arabia have refused to cut production would kill USA production by driving down prices and forcing some producers out of business.
Saudi Arabia and other OPEC producers have been refusing to reduce output in an attempt to drive less competitive players, in particular U.S. shale oil producers, out of the market. A Reuters survey released on January 5 showed Iranian production at 2.9 million bpd in December.
Iran returned to the global oil market just weeks ago after sanctions on its energy and banking sector were lifted upon implementation of a landmark deal on its nuclear program with world powers.
OPEC is dead, at least when it comes to dictating the price of oil on the global market, says one Texas congressman.
Mr Zanganeh did not mention if Iran, the second-biggest Opec producer before sanctions were intensified in 2012, would deviate from plans to restore exports after the lifting of penalties last month.
The plan to freeze oil production to push up prices seems to be falling at the first hurdle.
“Freezing the output is against Iran’s national and economic interests, Zanganeh can not accept it”, he said.
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Anas al-Saleh, who is Kuwait’s deputy premier, finance minister and acting oil minister, said in a statement that his country was committed to the proposal if others join in.
