Oil has slipped towards $47 a barrel, falling further from the previous session's one-week high on receding hopes for imminent action to tackle a supply glut. Sonia Legg reports
The oil price rally didn't last long - Brent Crude was back to $47 a barrel on Tuesday after hopes of a production cut were dashed. Even a production freeze seemed unlikely, despite a cooperation agreement between Russia and Saudi Arabia at the G20 summit. (SOUNDBITE) (English) JASPER LAWLER, MARKET ANALYST, IG, SAYING: "Given the close proximity of a series of meeting that we have got lined up now, this interim meeting with OPEC and Russia and this separate meeting with Russia and Saudi Arabia, then the official OPEC meeting later, I think this month it is very, very unlikely we will see a freeze, just a coming together of minds setting up potential for a freeze in November." Oil prices are half the level they were in mid-2014 and producer nations are suffering. OPEC and Russia tried to curb the glut earlier this year but the deal collapsed. Tensions between Saudi Arabia and Iran the main problem. (SOUNDBITE) (English) JASPER LAWLER, MARKET ANALYST, IG, SAYING: "Saudi Arabia is only willing to do it when Iran climbs on board, Russia knows that that's Saudi Arabia's criteria so both are in a holding pattern, showing a willingness but not actually doing it." OPEC's Secretary-General was in Tehran on Tuesday meeting Iran's oil minister. And some measures suggest Iran is now pumping at its pre-sanctions rate. That could mean they may be more willing to reach an understanding with other producers.