In yet another sign that behind the frequently blasted OPEC headlines meant to suggest a sense of OPEC unity yet which do nothing more than incite a short squeeze (as even Morgan Stanley has now admitted), there is far less cohesion, moments ago we learned that Nigeria's Oil minister Emmanuel Kachikwu is the latest to skip this week's Doha meeting scheduled for November 17 and 18. Earlier today we found that Iraq’s oil minister would likewise bypass the energy talks this week in Qatar, where rival producer Saudi Arabia plans to hold talks with Russia on possible collective action to limit production. Earlier today Bloomberg reported that his Iranian counterpart is also said to be giving the meeting a miss.
Iraq and Iran both want exemptions from any OPEC cuts in output, putting pressure on Saudi Arabia, the producer group’s biggest member, to bear the brunt of a possible reduction. The Organization of Petroleum Exporting Countries has yet to find a way to finalize a preliminary deal it reached in September to curtail supply, ending a two-year policy of pumping without limits.
The apparent acrimony comes at a time when OPEC is record amounts of oil, and with many countries granted exemptions from an oil production cut, it means that ahead of the Vienna summit in two weeks time, there is absolutely no coordination on who will cut supply, if anyone.
As Bloomberg notes, Saudi Arabian Energy Minister Khalid Al-Falih is leading the efforts to rein in global production to support prices. He’ll join several fellow OPEC members in Doha this week for informal consultations with Russia, the biggest energy supplier outside the group. They plan talks on the sidelines of the Gas Exporting Countries Forum. As a reminder, it was headlines from Russia moments after today's DOE report that sent oil surging.
However, many of the biggest oil producers will not be present: Iraqi Oil Minister Jabbar Al-Luaibi won’t be traveling to Doha this week, the ministry’s spokesman, Asim Jihad, said Wednesday by phone. Hamed Al-Zobaie, Iraq’s deputy minister for natural gas affairs, will represent the country instead, Jihad said.
Additionally, Iranian Oil Minister Bijan Namdar Zanganeh won’t be going to the Qatari capital, according to an Iranian oil official. Iran will be represented by OPEC governor Hossein Kazempour Ardebili and the country’s national representative at OPEC, Behrooz Baikalizadeh, the official said. OPEC signaled last month that Iran, Nigeria and Libya would be spared from having to make any cuts, due to sanctions and security issues that have curtailed their crude output. Iraq wants similar treatment, citing the burden of its war with Islamic State militants.
And now, Nigeria is the latest to skip the meeting altogether.
- NIGERIA OIL MINISTER SAID TO NOT BE ATTENDING DOHA OPEC TALKS
After surging earlier today on the latest round of Russian jawboning, in which Russian oil minister Novak said he sees a "high chance" of an OPEC accord on November 30, oil is now quietly fading the entire move.
Which could be a major problem for the massive spike in call option buyers that appeared yesterday.