We all knew this would be the outcome to these preposterous meetings, did we not? It was concocted by an immature 30 year old Saudi Prince, after all. This is a young man, who grew up with palatial privilege, totally unfamiliar with how to deal with hard men who’d rather blow themselves up in Doha than to cede power to a monarchy of self-righteous, greedy, boys.
As such, the talks have ended without an agreement.
The summit in the Qatari capital, which dragged on for more than ten hours beyond its initially scheduled conclusion, finished with no final accord, Nigeria’s Petroleum Minister Emmanuel Kachikwu told reporters. Discussions stumbled over whether the agreement should extend to other producers such as Iran, which wasn’t present, according to a person familiar with the matter. The inability to reach consensus will lead to a “severe” drop in prices, Citigroup Inc. predicted before the meeting.
Brent crude, which sank to a 12-year low in January, has climbed almost 30 percent in the past two months as Saudi Arabia and Russia worked on the plan to cap crude production. While analysts doubted that any accord would have a significant impact on the global oil surplus, the inability to agree on a limit undermines any prospect of coordinated action to solve the oil crisis.
“The Doha meeting was an opportunity for OPEC to polish its tarnished image,” Miswin Mahesh, an analyst at Barclays Plc in London, said on April 15. “After the failure of OPEC’s December meeting, the market was uneasy about its cohesion and Doha was a chance for the group to reassert its relevance and build a circle of trust.”
Unlike many others out there, I don’t think the price of crude will drop much when futures open for trade. These talks never stood a chance to begin with and it’s not like freezing production at all time highs was ever going to have a meaningful impact on the oversupply situation that plagues oil prices.
If oil should drop, however, I’ll be pleased–as I am leveraged short XLE.
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Back to the 30’s please
they seem upity, reduced revenue has to stir up a fuss, yes?
I knew. “Talks on oil freeze collapse under Saudi opposition” = least surprising headline of the year.
For a remarkably concise and extremely depressing history of our idiotic behavior in the Middle East over oil and other things, go listen to this, starting at 9:16. It’s like taking the red pill.
http://tinyurl.com/hudum85