- Producers may consider freezing oil output at February levels
- Oil price to end year at $45-$60, Kuwait's OPEC governor says
The Organization of Petroleum Exporting Countries and other major oil producing countries can reach an agreement for a production freeze, even if Iran doesn’t join the action meant to help shore up prices, according to Kuwait’s OPEC governor.
Oil-producing countries have no option but to reach an agreement to freeze output when they meet on April 17 in Doha, Qatar, because prices are too low, Nawal al-Fezaia said in a telephone interview on Tuesday. The freeze, which may be at February levels, may also help set a floor for oil prices, she said.
“Oil producers have no option but to freeze their production as oil prices are low and hurting everyone,” she said. “All early signs before the meeting point to this conclusion.”
OPEC and other producers are meeting in Doha to finalize the agreement to freeze production in an effort to curb the global glut. Their unity came under immense strain last week as Saudi Arabia’s deputy crown prince said the kingdom’s commitment depends on regional rival Iran. While Iran may attend the talks, it has refused any limits on crude supply as it restores oil exports after international sanctions were lifted in January.
Rising production from Iran won’t hinder the agreement as the country will find it difficult to sell its crude in an oversupplied market, Kuwait’s al-Fezaia said.
The oil market is expected to return to balance in the second half of this year, she said. Oil prices may end the year at a level between $45 and $60 a barrel, she said. Brent for June settlement traded at $37.58 a barrel on the London-based ICE Futures Europe exchange on Tuesday.