The global prices of oil continue to fall in spite of a deal between Saudi Arabia and Russia to lower output down to January levels if other producers agreed to do the same.
Oil Prices Still On Decline after a Saudi Arabia- Russian Deal to Stop Output
Ministers from both countries met in Doha, along with their Qatar and Venezuela counterparts to discuss solutions to the tumbling oil prices.
On Tuesday, Brent crude was down by 3.2 percent at $32.33 per barrel while US crude was down by 2 percent at $29.14.
Oil prices continue to tumble from their high of $116 in 2014.
According to the Saudi oil minister, Ali al-Naimi, ‘Putting a freeze to production at January levels should be enough for the market. We are avoiding significant fluctuations in prices, we only want to meet demand and attain a stable oil price.”
Eulogio Del Pino, the Venezuelan oil minister met with major oil producers to garner support for the reduction of production levels in an attempt to stabilize the prices.
On Tuesday he announced, ‘We have reached a historical deal for oil producers in Venezuela and in other countries to allow for market stabilization.”
Following the announcement, Mr Del Pin said he would visit his counterparts in Iran and Iraq on Wednesday.
According to the oil ministry in Iraq, the country would support a freeze on production if other producers supported the deal.
In January, Iraq announced historically high production with output totaling to an average of $4.7 million barrels per day. Data from the International Energy Agency indicates that Iraq is the second largest producer of oil in OPEC.
However, Iran has been slow to support an oil freeze with the petroleum minister, Bijan Zengeneh saying that the country would not compromise its oil market share.
Following the lifting of western sanctions, Iran has been keen to play catch up, increasing fears of oversupply.
Rokneddin Javadi, the country’s deputy petroleum minister announced that Iran had increased production of crude oil by 400,000 barrels per day, with this expected to increase by an additional 200,000 barrels.