Doha talks fail, new attempt to reach oil production agreement possible in June
Oil producing constructions did not manage to sign an agreement to freeze oil production at the January level following six hours of negotiations in Doha on Sunday, but they might hold another round of negotiations in June, Nigerian Minister of State for Petroleum Resources Emmanuel Ibe Kachikwu told reporters.
OPEC and non-OPEC members will probably hold negotiations in June, he said.
Participants in the meeting, including the Nigerian minister and Oman Oil and Gas Minister Muhammad al-Rumhi, said countries need more time to agree on the conditions of an oil production freeze.
Consultations will probably continue in Vienna in June, as OPEC must first resolve its internal problems, Kachikwu said, adding that the meeting in Vienna will probably initially include OPEC countries and they will then be joined by other producers.
He did not comment on whether the Doha talks failed because of the political standoff between Saudi Arabia and Iran.
Qatar Energy and Industry Minister Muhammad al-Sada said that the participants in the Doha meeting expect that oil prices will respond to fundamental economic factors, not the results of the negotiations.
He said the situation on the oil market has improved compared to February, when Russia, Saudi Arabia, Venezuela and Qatar proposed a production freeze.
The oil market has recovered since February, fundamental market factors are improving and this trend is due to a decrease in production of unconventional oil and reduction of investment, the minister said.
The market is improving, oil prices are moving in the right direction, he stressed.
Asked how he expects oil prices to behave after the Doha meeting, the Qatari minister said producers understand that there are some factors for a drop in price, but they hope that the market will respond to positive fundamentals that have dominated in recent months, rather than momentary news from the meeting.
He said the participants in the meeting considered various options for a production freeze, at different levels and for various time periods, but they realized that more time is needed to make such a decision. In light of this, they have taken a timeout and all oil producers will continue consultations until the OPEC meeting in June.
They considered various scenarios, devoting sufficient time to each one, and decided that they need time to consider these scenarios and possible other options, he stressed.
Remarking that Qatar respects Iran's position, the minister said that a production freeze would certainly be more effective if all OPEC countries and non-OPEC producers agreed to it, as this would accelerate the rebalancing of the market.
He also said that a very effective mechanism of contacts among oil producing countries has been created in the past two months.