Saudi Arabia, Iran dash hopes for OPEC oil deal in Algeria

Saudi Arabia, Iran dash hopes for OPEC oil deal in Algeria

Wednesday, September 28, 2016 8:48 am

Mohammed Barkindo: OPEC Sec. Gen

Mohammed Barkindo: OPEC Sec. Gen

Saudi Arabia and Iran on Tuesday dashed hopes that OPEC oil producers could clinch an output-limiting deal in Algeria this week due to their utterances, a report says.

The report quoted Saudi Arabia’s Energy Minister, Khalid al-Falih, as telling reporters in Algiers that “this is a consultative meeting. We will consult with everyone else, we will hear the views, we will hear the secretariat of OPEC and also hear from consumers.”

Also, Iranian Oil Minister, Bijan Zanganeh, said “it is not the time for decision-making,” referring to the next formal OPEC meeting in Vienna on Nov. 30.

‘He added that “we will try to reach agreement for November.”

Both spoke at the ongoing International Energy Forum in Algiers, scheduled to end on Wednesday

But OPEC will hold informal talks on oil output freeze on Wednesday and its members are also meeting non-OPEC producers such as Russia and others on the sidelines of the forum.

Oil prices have more than halved from 2014 levels due to oversupply, prompting OPEC producers and rival Russia to seek a market rebalancing that would boost revenues from oil exports and help their crippled budgets.

The predominant idea since early 2016 among producers had been to agree to freeze output levels, although market watchers said such a move would fail to reduce unwanted barrels.

Sources said last week that Saudi Arabia had offered to reduce its output if Iran agreed to freeze production.

The offer was a shift in Riyadh’s position as the kingdom had previously refused to discuss output cuts.

On Monday, Iranian Oil Minister Bijan Zanganeh said expectations should be modest and several OPEC delegates said the positions of Saudi Arabia and Iran remained too far apart.

Due to the utterances, oil prices were down 2 per cent in Tuesday’s trade.

Brent crude futures fell 1.30 dollars to 46.05 dollars a barrel by noon, having closed up 1.46 dollars or 3.2 per cent in the previous session.

U.S. West Texas Intermediate (WTI) crude dropped 1.31 cents to 44.62 dollars a barrel, after rising 1.45 dollars or 3.3 per cent, in the previous session. (Reuters/NAN)

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