LONDON Oil down on Saudi output deal doubts
OIL prices fell sharply on September 23, wiping out much of the gains, after reports that Saudi Arabia is downplaying prospects of a producers deal on output this week.
The key benchmarks Brent crude and West Texas Intermediate (WTI) both lost more than 3 percent as earlier hopes faded for the informal meeting of OPEC producers and Russia in Algiers.
The losses came after Bloomberg reported that an OPEC delegate “familiar with Saudi Arabian policy” said Riyadh did not expect any deal to limit output.
Earlier, the market had been encouraged by another unconfirmed report that the Saudis were talking with Iran about a mutual deal to freeze production.
Russia and members of the OPEC oil cartel led by Saudi Arabia are attending the International Energy Forum in Algiers beginning today, with informal talks on countering the market glut planned for the sidelines of the three-day event.
Traders are uncertain that a deal can be reached on maintaining, much less cutting, output levels.
Reports that Saudi Arabia, Iran and Qatar had met at the OPEC headquarters in Vienna had fuelled optimism.
An earlier Saudi-led attempt to freeze output fell apart in April after Iran refused to participate, saying it needed to raise production depleted by years of Western economic sanctions, which were lifted only in January.