Egypt Independent

Oil prices edge lower on doubts over production cut deal

Oil prices edged lower on Friday and were set for the biggest weekly losses in six weeks over doubts about whether oil producers will be able to agree on an output cut big enough to curb a global glut that has weighed on markets for two years.

Experts from the Organization of the Petroleum Exporting Countries and counterparts from other oil-producing nations such as Russia started two-day negotiations on Friday over an output-capping agreement expected to be presented at the end of next month.

Disagreements remain over which members should be exempt from a curb to reduce output to a range of 32.5-33 million barrels per day (bpd), underscoring how difficult it will be for participants to reach a deal.

Brent crude futures LCOc1 were down 35 cents at $50.12 a barrel at 0801 ET. The contract was set to close the week more than 3 percent lower in its steepest weekly loss since mid-September.

U.S. West Texas Intermediate (WTI) CLc1 crude was down 46 cents at $49.26 a barrel, also on track for its biggest weekly loss in six weeks.

"Doubts linger about OPEC's ability or willingness to implement any production cuts," said analysts at Cenkos Natural Resources.

"The market has been wary of reading too much into the rhetoric ahead of the next meeting scheduled for the end of November."

Analysts at Commerzbank said the success of an output deal will depend on whether Gulf producers Saudi Arabia, the United Arab Emirates, Kuwait and Qatar are willing to implement the production cuts on their own if no agreement can be reached with other producers. 

French oil major Total said on Friday it expected crude prices to remain volatile and continued to reduce costs.

The French company said it loses around 2 billion euros in cashflow for every $10 downward move in oil prices.

Weak prices have also hit Italian oil firm ENI, which reported a worse-than-expected quarterly loss on Friday.