DOHA, Qatar -- Saudi Arabia, Russia and other major oil producing nations failed to agree on a crude output freeze Sunday, as Iran's absence cast shadows over the talks.
More than 10 OPEC and non-OPEC members took part in the meeting, with the aim of keeping production at January levels until October. But the absence of Iran apparently irked the Saudis and other participants. "We concluded we all need time to consult further," Qatar's energy minister Mohammed al-Sada told a press conference. They hope to reach a conclusion at the next OPEC meeting to be held June 2.
A protracted slump in oil prices has eroded the finances of oil producing nations and related industries, weighing on the global economy.
Saudi Arabia, Russia, Venezuela and Qatar had tentatively agreed in February to freeze production at January levels on the condition that other major producers join them.
But Iran, eager to raise production following the lifting of Western sanctions, has declined to participate until its output recovers to pre-sanctions levels. Iranian Petroleum Minister Bijan Zanganeh said ahead of the meeting that Tehran did not need to send a representative, as the country will not join the deal.
Saudi Arabian Deputy Crown Prince Mohammed bin Salman told Bloomberg on Saturday that the kingdom would not participate in the agreement unless Iran also agrees to a freeze. Their rivalry could jeopardize a potential deal. Tehran and Riyadh, competing for influence in the Middle East, severed diplomatic ties in January after the kingdom's execution of a dissident cleric inflamed sectarian tensions.
North Sea Brent crude, which surpassed $115 per barrel in June 2014, has been declining on excess supply, hitting a roughly 12-year low of the $27 level in January. Prices have recovered lately on expectations of a deal, nearing $45 at one point. But Saudi and Russian production levels already have reached record levels, and a production freeze would only prevent an increase. Unlike a production cut, it would have no immediate impact in addressing excess supply.