Abu Dhabi: A crucial meeting of Opec will take place in Vienna on Wednesday as doubts persist whether the 14-member group will come to a consensus on output cut.
Oil prices were trading lower on Tuesday because oil exporters were still struggling to agree on a deal to slash production and reduce oversupply in the market.
Russia confirmed it will not be taking part in the talks and Iran and Iraq are resisting pressure from Saudi Arabia to curtail output.
Brent, the global benchmark, fell below $46.40 per barrel, down almost 4 per cent and the US crude West Texas Intermediate at $45.33, down by 3.72 per cent at around 6:05pm UAE time.
The oil ministers will be locked up in intense discussions to implement an agreement reached in September in Algeria to reduce output to a range of 32.5 to 33 million barrels a day from the present figure of 33.64 million barrels a day.
Analysts are sceptical whether there would be any deal and even if there is one it would just be a symbolic without much impact on oil prices.
“An agreement of some sort is more likely than not to emerge this week, as there are intense financial, political and credibility pressures on Opec to strike a deal even if it is flawed,” said Spencer Welch, Opec expert and Director at IHS Energy based in London in a statement to Gulf News.
He, however said a deal will be extremely challenging to deliver given political differences between members, particularly Saudi Arabia and Iran, and several Opec nations actively trying to increase production — Iran, Iraq, Nigeria and Libya.
“If there is a deal then oil prices are likely to rise probably by $1 to $2 per barrel and if there is no deal then prices will fall by a little more in the range of $2 to $4 per barrel. “
This is the first time since the financial crisis in 2008 that the group is trying to reach a deal to reduce supplies to boost oil prices.