The global oil deal that never came to be

Mon Apr 18, 2016 1:40pm EDT
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By Vladimir Soldatkin, Sam Wilkin and Tom Finn

DOHA (Reuters) - It was supposed to be the easiest deal ever reached among key oil market players, a mere formality.

Eighteen countries were gathering in the Qatari capital of Doha to rubber-stamp the first joint agreement between major OPEC and non-OPEC nations in 15 years, tackling a huge global glut after flooding the market for two years.

The text was agreed and the timeframe was clear. Oil prices were rising. Traders were calling the event boring.

Then, the first clouds began to appear.

Thousands of kilometers away from Doha, at a Friday summit of the Organization of Islamic Cooperation in Istanbul, Saudi King Salman bin Abdulaziz and Iranian President Hassan Rouhani gave each other the cold shoulder in front of cameras after the 57-member group accused Iran of supporting terrorism.

The frosty tone was noted and quickly became a talking point among some delegates and OPEC watchers in Doha.

None of the OPEC and oil industry sources who spoke to Reuters linked the subsequent collapse of the oil meeting in Doha to the events in Istanbul directly.

But they said it was indicative of the deep mistrust between the Sunni Muslim kingdom and the Shi'ite Islamic republic, which compete for influence in the Middle East and are currently fighting proxy wars in Syria and Yemen.   Continued...

A worker checks the valve of an oil pipe at Al-Sheiba oil refinery in the southern Iraq city of Basra, April 17, 2016. REUTERS/Essam Al-Sudani