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High Level of Disagreement Results in Doha Oil Meeting Failure

The failure to reach any agreement at the oil meeting in Doha demonstrates the level of disagreement between key participants, according to the report of the US JP Morgan bank.

"We believe for negotiations to have become so protracted so late in the process, illustrates the level of disagreement between key participants at the talks and - based upon the press reports in recent days - possibly some internal differences of opinion within the Saudi delegation," analysts said in the report.

Reports indicate that initial drafts of the agreement to freeze output failed to satisfy Saudi Arabia with regards to the commitments required of other producers, most notably Iran. However, these last minute negotiations are unusual and reminiscent in tone to the problems OPEC members faced in their discussions of 4Q14, when OPEC failed to agree on how to respond to falling prices, analysts added.

They also noted that the fact that so many oil ministers attended the meeting indicates that participants believed that all but the smallest details had been agreed.

Oil producers on Sunday failed to reach a deal to freeze oil output. The talks collapsed after Saudi Arabia surprised the group by reasserting a demand that Iran also agree to cap its oil production.

Iran was not represented at the meeting.

Meanwhile, earlier Iran's Oil Minister Bijan Zanganeh said that the country didn't contribute to the disbalance on the oil market, thus would not freeze its output.

JP Morgan's analysts noted that comments from some (OPEC) oil ministers could almost be interpreted as being the second scenario they highlighted in their weekly note - no agreement, but to keep the dialogue open.

"However, the disparity between participants' views leave us in no doubt that this is a materially weaker outcome than markets were anticipating," analysts said.

Source: Trend

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