While some crude producers are discussing a possibility to freeze oil output, others do not find this idea effective. Saudi Arabia, Russia, Venezuela, and Qatar came to an agreement on keeping crude production at January levels in 2016. However, the output freeze will come into force only in case other countries join the agreement.
US officials are quite skeptical about such a decision. Amos J. Hochstein, the US State Department's special envoy for international energy affairs, expressed authorities’ opinion: "Locking in countries' production near historic production highs does not change an oversupplied market." The US supposes that such initiatives will only worsen the current imbalance. American officials are sure that the market should regulate its inner processes on its own. According to Hochstein, the US attempts to cooperate with both oil producers and consumers. The senior US energy official points out that the US does not consider crude oil a tool of political influence and adds that the government should not intervene in
the process and regulate it artificially through instructing how much oil to produce and sell abroad.
Now, market participants only have to wait and see whose strategy will work out. Given the facts that Iran refused to trim its crude production and that Saudi Arabia said it did not agree on anything, chances of successful production freeze equal zero.
