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Oil fell to a two-week low as an OPEC deal to curb output appeared in jeopardy after Iran and Saudi Arabia failed to bridge differences.
Futures tumbled 3.9 percent after Iranian Oil Minister Bijan Namdar Zanganeh told reporters in Vienna his nation won’t reduce production. A 10-hour technical meeting focusing on how to share the burden of cuts failedto resolve differences. Saudi Arabia is ready to reject an agreement unless all OPEC members, excluding Libya and Nigeria, participate, said people familiar with the kingdom’s current position at the talks.
"This is going to go right down to the wire," Mike Wittner, head of oil-market research at Societe Generale SA in New York, said by telephone. "The Saudis have been remarkably consistent in what they expect from the Iranians over the last two months."
Goldman Sachs Group Inc. said the market is pricing in a 30 percent chance of a deal. While an accord could push prices up about $5 a barrel, according to Morgan Stanley, a failure could drive it down into the $20s, said Amrita Sen, chief oil analyst at Energy Aspects Ltd. Saudi Arabia’s Energy Minister Khalid Al-Falih, who has led the push for OPEC to cut production for the first time in eight years, changed his tone on Sunday, saying a deal might not be needed.