OPEC and Russia Oil Negotiations Without Iran and Iraq

Oil ministers from OPEC member countries and Russia will meet on Thursday on the sidelines of the Gas Exporting Countries Forum in Qatar to discuss oil production cuts. This meeting comes as the oil ministers of Iran, Iraq, and Nigeria will be absent. The meeting takes place two weeks before the annual OPEC oil ministers' meeting. Two months ago, OPEC members and Russia implicitly agreed to cut production to increase oil prices. However, last month, OPEC's oil production, according to its own statistics, increased for the third consecutive month, reaching 33 million and 643 thousand barrels per day. The International Energy Agency even estimated that the actual production of OPEC members was 33 million and 800 thousand barrels. In this context, Bloomberg reported on Wednesday, November 17, citing OPEC sources, that Saudi Arabia, Iran, and Iraq are hesitant about how to approach the idea of reducing oil production. At the two-month-ago meeting of OPEC members in Algeria, an implicit agreement was made to reduce the organization's production to between 32.5 and 33 million barrels per day. Iran claims that it has nearly restored its production to pre-sanction levels and will continue to produce up to 4 million barrels per day. Iraq also states that OPEC reports its daily production as 300 thousand barrels less than the actual figure and will never agree to a production figure below 4.8 million barrels. Moreover, this country argues that it is engaged in a battle against ISIS and has an urgent need for oil dollars. Two other OPEC members, Nigeria and Libya, which have reduced their production due to internal unrest, also say that they should not be expected to increase their production. On the other hand, Reuters reported yesterday, citing informed officials, that Saudi Arabia is hesitant about whether to join the oil production cut agreement, considering Donald Trump's victory and the possibility of new U.S. sanctions against Iran or the collapse of the nuclear deal that would reinstate oil sanctions on Iran, or to seize the opportunity to increase its market share in international oil markets. The International Energy Agency has predicted that if OPEC and Russia members do not agree on production cuts, the surplus oil in international markets will continue into next year, and oil prices will remain low. However, Alexander Novak, who is set to travel to Iran on Thursday and then head to Qatar for a meeting with OPEC members, stated today that the chances of a successful oil agreement are high and that his country is prepared to support a decision to cut oil production.