Oil prices tracked low this morning, after Saudi Arabia's oil minister reportedly said that investors should "forget about" a production cut.
Ali al-Naimi, told the al-Hayat newspaper that an outright production cut, as demanded by some producers, was out of the question.
"Forget about this topic," al-Naimi told the paper, reiterating the Kingdom's previous position on a possible reduction in his country's production.
US benchmark West Texas Intermediate fell 1.7 per cent to $41.5 per barrel. Meanwhile, Brent crude, the global benchmark, slumped 1.2 per cent to $44.1.
A production cut would involve Opec and non-Opec members reducing their output. This would be a step further than an agreement to freeze production at a certain level, the latter of which is widely expected at a meeting in Doha on Sunday.
Increased optimism about the meeting helped oil prices climb to their highest level this year yesterday, partly due to a report that Russia and Saudi Arabia have agreed to hold production steady ahead of the meeting.
Nevertheless, analysts and traders remained sceptical about the potential freeze deal’s ability to balance the oversupplied global oil markets – especially in the absence of Iran which has vowed to return oil output to pre-sanction levels.
"Investors have been burned before that Opec (the Organization of the Petroleum Exporting Countries) will do something - the fundamentals of this thought have shown to be made of sand," said Ben Le Brun, market analyst at Sydney's OptionsExpress.