The 14-member Organization of the Petroleum Exporting Countries announced a preliminary deal in September to cut oil output to 32.5-33.0 million barrels per day (bpd) from a record 33.64 million bpd now, to bolster perennially low prices.
Although doubts existed over whether the organization, including regional foes Saudi Arabia and Iran, could agree on the mechanism of a cut, many market watchers believed last week a deal would be struck if only to save the group’s credibility.
But the chances of an agreement declined over the weekend after Saudi Arabia said oil markets would balance next year even without an OPEC deal and a meeting with non-OPEC producers such as Russia was canceled, sparking shuttle diplomacy to smooth differences before Wednesday’s Vienna gathering.
Analysts’ forecasts for oil prices now vary widely.
With a realistic but significant deal struck, prices could reach $60 a barrel, according to the most optimistic forecast, or barely approach $50, according to the most prediction.
Should OPEC fail to strike a deal, prices may briefly fall to the low $40s but return to current levels, according to the most forecast, or slide downwards to $40, opening the door to $30 a barrel, according to other predictions.
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