Following last night’s leaked draft Doha document, which envisions a non-binding, “gentleman-like” oil freeze agreement, that caps production at January levels until October, with zero enforcement or oversight, moments ago the formal Doha talks started:
- OIL PRODUCERS START FORMAL TALKS ON OUTPUT FREEZE IN DOHA
However, even before the start, things did not look good, when Saudi Arabia delayed the start of the meeting in what seemed to be a redrafting to account for the inclusion of Iran as part of the freeze, something which Iran has clearly said it won’t do.
- DOHA OIL MEETING DELAYED AFTER SAUDIS REQUEST CHANGES: REUTERS
- DOHA OIL TALKS SAID DELAYED UNTIL AFTER VISIT TO EMIR PALACE
- DOHA OIL-FREEZE PROPOSAL SAID BEING AMENDED AHEAD OF MEETING
- OIL-OUTPUT FREEZE DEAL SAID BEING AMENDED TO ACCOUNT FOR IRAN
Furthermore, we already know what the next strawman will be once today’s “deal” disappoints: yet another meeting which will keep the headline scanning algos busy
- OIL PRODUCERS SAID TO PLAN NEXT FREEZE MEETING IN RUSSIA OCT.20
Or as one commentator put it, “more meetings, more jawboning.It’s OPEC’s OMT program. Freeze won’t happen,but they hope pretending it will, will do the trick” which is exactly the point.
So where are we now?
According to Reuters things are not as “optimistic” as Ecuador, Venezuela and many of the other high-cost, and quite desperate, OPEC producers had hoped ahead of the meeting.
According to the wire service, “a spike in tensions between arch-rivals Saudi Arabia and Iran appeared on Sunday to ruin prospects of the first binding oil output deal in 15 years between OPEC and non-OPEC nations, and looked set to prompt another fall in the price of crude.”
But the meeting was postponed after OPEC’s de facto leader Saudi Arabia told participants it wanted all OPEC members to take part in the freeze, according to OPEC sources.
Riyadh had earlier insisted on excluding Iran from the talks because Tehran had refused to freeze production, seeking to regain market share after the lifting of Western sanctions against it in January.
With the deal running into trouble, oil ministers in Doha met with the Qatari emir, Sheikh Tamim bin Hamad al-Thani – who was instrumental in promoting output stability in recent months.
But a new draft seen by sources thereafter contained none of the binding points of the previous outline. Ministers are due to start talks at around 1200-1230 GMT, according to 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.”
Failure to reach a global deal would signal the resumption of a battle for market share between key producers and likely halt a recent recovery in prices.
And then, someone finally got to the bottom of things: “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.
We will update this developing story as more news hits.
The post “I Am Not Sure You Can Call It A Freeze” – OPEC Deal In Jeopardy As Saudi-Iran Tensions Spike: All The Latest appeared first on crude-oil.top.