Oil prices fell yesterday (April 17) after attempts by many of the world’s largest oil producers to freeze output finished without a deal being put in place.
The sticking point proved to be Saudi Arabia insisting on its belief that Iran should be involved in any deal.
Early this morning, oil prices dropped by as much as 7% in Asia, before benefiting from a very slight recovery. This came about as the result of talks in the Qatari capital of Doha, which were set up to achieve the first global oil deal since 2001, but fell through.
The unique deal had looked set to go ahead when representatives of the world’s most important oil producers gathered on Sunday. However, assembled individuals were forced to break late in the day when progress was stalled by opposition from Saudi capital Riyadh, which had become tougher in its stance in the days leading up to the meeting.
The ongoing tensions between Saudi Arabia and Iran were also a major factor in Brent prices falling by 3.9%, seeing as they were an issue that was impossible to overcome.
Speaking about the issue, Qatar’s Energy Minister Bin Saleh Al-Sada stressed the need for more time for consultation to continue. Meanwhile, Iraqi representative Falah Alamri commented:
“We are very very disappointed. This will affect the [oil] price and our earnings. We wanted a deal.”
The current state of the oil industry is posing challenges for major companies like Royal Dutch Shell and Fuchs, which produces various oil-based products like Fuchs WSP 783-L.