Date
29 May 2017
Ali al-Naimi (center) Saudi Arabia's minister of oil and mineral resources, refused to sign a deal to limit output unless all OPEC members, including Iran, agreed to it. Photo: AFP
Ali al-Naimi (center) Saudi Arabia's minister of oil and mineral resources, refused to sign a deal to limit output unless all OPEC members, including Iran, agreed to it. Photo: AFP

Oil prices dive after talks to curb output fail

Oil tumbled by the most in two months after talks Sunday between the world’s biggest producers ended without any agreement on limiting supplies, Bloomberg reported.

Futures fell as much as 6.8 percent in New York, the biggest intraday drop since Feb. 1.

The summit in Doha, Qatar’s capital, which went on more than 10 hours beyond schedule, finished with no final accord.

Discussions stumbled after Saudi Arabia and other Gulf nations wouldn’t agree to any deal unless all members of the Organization of the Petroleum Exporting Countries, including Iran, which wasn’t present at the meeting, signed up, Russian Energy Minister Alexander Novak told reporters.

“The market has been so heavily positioned for a deal to go through,” Angus Nicholson, an analyst at IG Ltd. in Melbourne, said by phone.

“The change of tone from the Saudis, particularly driven over the last few weeks by Deputy Crown Prince Mohammed bin Salman, has been quite a surprise to the market.”

Oil ministers from 16 countries , representing about half the world’s output, gathered in Doha to try to stabilize the global market, the first significant attempt at coordinating oil output between OPEC and countries outside the group in 15 years.

There were significant hurdles to any deal after Salman said Saudi Arabia wouldn’t restrain its production without commitments from other major producers, including Iran.

Iran, which is reviving oil exports after international sanctions were lifted in January, ruled out any limits on its output before reaching pre-sanctions levels, dismissing the notion of joining the freeze as “ridiculous” and amounting to self-imposed sanctions.

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