Oil prices have sunk today as investors scale back their expectations of a deal to curb output between some of the world's biggest suppliers.
Rival producers Iran and Saudi Arabia have both poured water on the possibility of a deal being reached to limit oil exports, which have remained at record highs all year. Both countries have said the meetings this week are purely "consultative" and will result in no formal agreements.
The industry has been closely watching a three-day oil conference in Algiers that kicked off yesterday.
Saudi energy minister Khalid al-Falih told reporters:
This is a consultative meeting ... We will consult with everyone else, we will hear the views, we will hear the secretariat of Opec and also hear from consumers.
Meanwhile Iranian oil minister Bijan Zanganeh said:
It is not the time for decision-making. We will try to reach agreement for November.
A little earlier US oil dipped two per cent to under $45 per barrel, while international benchmark Brent crude was down almost a dollar at $46.36 per barrel. The price of oil remains less than half of what it was in the summer of 2014.
The fall in price has weighed on investment in the industry, especially in high-cost regions like the North Sea.
The Organization of the Petroleum Exporting Countries will hold informal talks at the summit tomorrow at 3pm London time, but next formal Opec meeting isn't until 30 November in Vienna.
Saudi Arabia and other Opec members have been steadily raising production to compete for market share with higher-cost producers in the US and Russia that have come online as drilling technology improves.
Iran is ramping up oil exports to try and regain market share after trade embargoes on the country were lifted earlier this year.
Craig Erlam, senior market analyst at Oanda, said:
As we’ve seen so often in the past, the possibility of a deal has been talked up a lot in the weeks leading up to tomorrow’s meeting and now it seems the opposite is happening.
Saudi Arabia’s energy minister Khalid al-Falih described tomorrow’s event as a consultative meeting earlier today, which doesn’t strike me as the kind of language that precedes a deal. Markets appear to be perceiving it in the same way.