Saudi Arabia’s oil minister plans to meet with his Russian counterpart in Doha on Tuesday to discuss the oil market, according to a person familiar with the talks.
Ali al-Naimi, the most senior oil official of the world’s biggest crude exporter, will speak with Russia’s Alexander Novak in the Qatari capital, according to the person, who asked not to be identified because the talks are private.
The person didn’t say what the agenda of the meeting will be, which will also be attended by the kingdom’s fellow OPEC member Venezuela. The energy ministries of Russia and Saudi Arabia declined to comment.
Saudi Arabia has insisted that it won’t reduce production to tackle the global oil glut unless major producers outside the Organization of Petroleum Exporting Countries co-operate. While Novak has said he could consider output cuts if other producers joined in, Igor Sechin, chief executive officer of the country’s largest oil company Rosneft OJSC, said last week he would defend traditional markets and expressed doubts over coordinated action.
Still, oil’s deepening slide this year to below $30 a barrel has put increased financial strain on oil-dependent economies and there’s been growing speculation that there may be an opportunity to discuss a deal between the world’s two largest exporters.
“The back channel talks, which Qatar is brokering, had been in place for a while,” said Amrita Sen, chief oil analyst at Energy Aspects Ltd. in London. “These are still very early days and nothing concrete has been agreed, but there is a growing sense that countries could be more flexible, although Riyadh would insist that everyone else contribute to the cut.”
Brent oil in London rose as much as $1.41 to $34.80 a barrel on Tuesday and was trading at $34.69 at 9:48 a.m. in Dubai.
OPEC and non-members have intermittently held discussions since November 2014, when the organization first signaled it was unwilling to cut production alone to support prices. Saudi Arabia, Venezuela, Russia and Mexico assembled in Vienna that month without reaching any deal. A tour of oil capitals from Moscow to Riyadh earlier this month by Venezuelan Energy Minister Eulogio Del Pino failed to produce an accord.
Nonetheless, the slightest signs of an accord have roiled oil markets. West Texas Intermediate futures rallied 12 percent on Feb. 12, the biggest surge since 2009, after the United Arab Emirates reiterated OPEC’s long-held position that the group is prepared to engage with non-members.
Doha’s closed-door meeting, planned in secret and hosted by Qatar’s oil minister, echoes the petro-diplomacy of the late 1999s. Then OPEC countries used diplomatic back channels with the help of Mexico to orchestrate a series of secret meetings from Miami to Amsterdam, which resulted in several production cuts.
Venezuela’s Information Ministry and the media offices at PDVSA and Venezuela’s Oil Ministry didn’t immediately respond to e-mails seeking comment.
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