A deal to freeze oil output by OPEC and non-OPEC producers fell apart on Sunday after Saudi Arabia demanded that Iran join in despite calls on Riyadh to save the agreement and help prop up crude prices.
After five hours of fierce debate about the wording of a communique – including between Saudi Arabia and Russia – delegates and ministers announced no deal had been reached.
“We concluded we all need time to consult further,” Qatar’s Energy Minister Mohammed al-Sada told reporters.
Several OPEC sources said if Iran agreed to join the freeze at the next OPEC meeting on June 2, talks with non-OPEC producers could resume.
The development will revive oil industry fears that major producers are embarking again on a battle for market share, especially after Riyadh threatened to raise output steeply if no freeze deal were reached.
Iran is also pledging to ramp up production following the lifting of Western sanctions in January, making a compromise with Riyadh almost impossible as the two fight proxy wars in Yemen and Syria.
Some 18 oil nations, including non-OPEC Russia, gathered in the Qatari capital of Doha for what was expected to be the rubber-stamping of a deal – in the making since February – to stabilise output at January levels until October 2016.
But OPEC’s de facto leader Saudi Arabia told participants it wanted all members of the Organization of the Petroleum Exporting Countries to take part in the freeze, including Iran, which was absent from the talks.
Tehran had refused to stabilise production, seeking to regain market share post-sanctions.
The failure to reach a global deal could halt a recent recovery in oil prices.
Saudi Arabia has taken a tough stance on Iran, the only major OPEC producer to refuse to participate in the freeze.
Saudi Deputy Crown Prince Mohammed bin Salman had told Bloomberg that the kingdom could quickly raise production and would restrain its output only if Iran agreed to a freeze.
Iran’s Oil Minister Bijan Zanganeh said on Saturday that OPEC and non-OPEC oil producers should simply accept the reality of Iran’s return to the oil market: “If Iran freezes its oil production … it cannot benefit from the lifting of sanctions.”
