Al-Khobar- Oil prices picked up on Monday, supported by media reports on imminent OPEC talks to check output.
As for desperate countries suffering economic paralysis due to drop of oil prices such as Venezuela, any meeting among producing countries in OPEC is a golden chance to trigger again oil output freeze. As for the markets, any meeting will certainly make a positive impact on supporting prices.
Despite absence of current talks regarding oil output freeze, news reported by international agencies and newspapers were enough to push traders to carry out new activities during the past three days; subsequently causing prices to rise.
“Though Algeria will witness an informal meeting for OPEC countries, it might also host an informal meeting with Russia to figure out its readiness along with other producers to seal a new deal to freeze oil output”, said Qatar’s energy minister, Mohammed bin Saleh al-Sada.
“However this is based on the deterioration of the market”, added al-Sada.
The minister commented on the recent decline in crude prices, saying the market volatility was “only temporary” and that higher demand in the third and fourth quarters would support oil price increases later in 2016.
However reaching such a deal seems unlikely since circumstances have changed. Brent price was USD32 in January and crude dropped below USD30 then; these two factors drew concerns that prices might encounter a dangerous phase so negotiations began between producing countries in February.
Yet, prices enhanced since February without the need for oil output freeze agreement; they maintained stability between USD40 and USD50 throughout months starting from March and until Monday.
Right now Russia sees no grounds for resuming talks to put a freeze on oil production, but is open to join discussions if OPEC members raise the issue, Russia’s Energy Minister Alexander Novak told reporters on Monday.