The internal squabbling of OPEC has once again cost it an opportunity to raise oil prices after more than 18 hours of marathon negotiations in Vienna failed to lead to a concrete agreement on production cuts.
Worse still, the group was also unable to convince non-OPEC states to participate in the planned production cuts - a key factor in raising the global oil prices.
Mohammed Barkindo, Secretary-General of OPEC, warned of the potential repercussions of not reaching an agreement. “Anything short of implementation of this accord could lead to the elongation of the rebalancing process, with further deterioration of financial conditions and setbacks in investments extending into a third year, which would be unprecedented.”
The negotiations focused on ironing out details for how OPEC members would implement agreed-upon production cuts of between 200,000 and 700,000 barrels a day. But Iraq and Iran both insisted on being exempt from cuts - a major sticking point for the oil cartel.
The members also tried - and failed - to secure coordinated cuts with non-OPEC producers, such as Russia. Barkindo emphasized the need for oil cuts across the board - not just from OPEC members.
"We should be calling for maximum commitment from all OPEC and non-OPEC countries," Barkindo said.
Member states will meet again later this month - their final opportunity to reach a detailed outline on production cuts before they're scheduled to submit their agenda to ministers on November 30.