The first success of an oil supply agreement between OPEC and Russia in boosting crude prices is magnifying the potential risks should producers this weekend fail to complete their agreement.
Brent futures, which sank to a low of 12 in January, rose 30 percent from Saudi Arabia, Russia, Qatar and Venezuela reached a preliminary agreement to freeze Release February 16 While the energy minister of Russia said he is "optimistic" the deal will be finalized in Doha on 17 April, Goldman Sachs Group Inc. warned that the weight of expectation poses a "bearish catalyst" if talks fail.
"they built this thing for so long, if they terminate just shouting at each other and out of the room, the negative impact on prices is quite serious," said Seth Kleinman, Director of the European energy research at Citigroup Inc. in London. "And they are probably well aware of that."
the tensions were visible throughout the negotiations. while the news agency Interfax reported Tuesday that Saudi Arabia decides to freeze whatever the actions of Iran, the kingdom has publicly emphasized his participation depends on his Persian rival, which excluded cap supply. Iraq has accelerated production to record levels, and Kuwait has announced similar plans. as rising prices help rival OPEC stay in business, the rationale of the agreement is frayed, says Goldman Sachs.
oil prices
"Why would they reverse course after 18 months of the current environment? We begin to finally see the fruits of that "in terms of reduced production, Jeff Currie, head of research for commodities at Goldman Sachs, said in a Bloomberg Television interview. There is a" high risk meeting fails to deliver any concrete agreement, "he said in a statement.
The Kremlin believes there is "hope" to conclude the pact without Iran, the press secretary Dmitry Peskov said. Energy Minister Alexander Novak spoke to Saudi Oil Minister Ali al-Naimi by phone Tuesday to discuss prospects for a freeze in production, a person with direct knowledge of the matter said. Novak said earlier on Tuesday he was "optimistic" about reaching a consensus.
The likely result will be April 17 "a sweet deal that would not really do anything fundamental," Currie said. Everything is stronger "not in anyone's interest right now. "
at least 15 countries - including most members of OPEC and non-members like Oman and Azerbaijan - have agreed to meet in the Qatari capital the weekend. While OPEC states had pushed production cuts instead of a gel, such as Venezuela and Algeria, have softened these calls, it only served to highlight the discord Saudi policy of the group to let market forces of supply and demand in balance.
Saudi Arabia is only willing to comply with a gel "if all countries agree," he said Deputy Crown Prince Mohammed bin Salman in an interview with Bloomberg published on April 1. Also, if other countries to increase production, the kingdom will boost its own sales, he said. Iran, which had sanctions on its oil exports lifted in January, has repeatedly stated its intention to resume production.
The Iranian Oil Minister Bijan Zanganeh Zamdar has not yet decided whether to attend the Doha meeting, Akbar Nematollahi, general manager of public relations at the Ministry of the nation's oil, said Wednesday.
Brent futures traded near $ 44 a barrel in London on Wednesday. Prices could tumble to $ 33 or even $ 30 a barrel if the meeting of April 17 ends without an agreement, Saxo Bank A / S predicted.
Bloomberg
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