Oil Talks Fail in Doha, Qatar

The top oil producers in the world were supposed to find an agreement that would stabilize the oil prices, but the Doha meeting failed. A steep fall in oil prices is now expected, and who knows where they will end up?

After a six-hour delay and six more hours of discussion, the world’s most powerful oil producers (except the USA) didn’t succeed in reaching an agreement regarding freezing the production of the 'black gold'.

The oil price (Brent) has fallen from 115 US dollars (summer 2014) to approximately 40 US dollars today. In January 2016, the price of oil even reached 27 US dollars, and this is the lowest level in the past 12 years. This imbalance between demand and supply is the reason why the oil prices are falling so sharply. Any movement in the oil prices can strongly affect many other financial sectors, such as the Forex markets, and you can read more about that on this page.

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Iran Refused to Participate in the Meeting

The 15 nations that met in Doha, Qatar, hoped to reach an agreement that would create a better balance between the supply and demand of oil, with the goal being higher and more stable prices. In the days leading up to the meeting, it became clear that the existing proposal had to be changed due to the fact that Iran refused to participate in the meeting. Iran also made it clear that it would not freeze its production even if the other member nations of OPEC decided to freeze theirs. The sanctions towards Iran have just recently been terminated, and they want to push Iranian oil out on the market.

Saudi Arabia might crank up the Oil Production

The day before the meeting, Mohammad bin Salman stated that Saudi-Arabia might crank up the production with as much as one million units per day if an agreement was not reached in Doha. He also told Bloomberg that Saudi-Arabia wouldn’t freeze its production unless the other big oil suppliers did the same. He then stated that they would sell oil at every opportunity. The coming months will undoubtedly be very interesting, but experts in the field believe that many of the oil producers are already near their maximum production level and that the prices will stabilize at a higher level, but how high is, of course, something difficult to foresee.

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■ Oil Talks Fail in Doha, Qatar

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