Saudi Arabia and Russia, the world’s two largest crude-oil exporters, said Tuesday they would halt production increases as long as other major producers followed suit, but prices fell anyway as investors looked for more-concrete action to reduce the global glut of petroleum.
The agreement struck in Doha was the first coordinated move in years to boost prices. Saudi Arabia, Qatar, Kuwait and Venezuela, all members of the Organization of the Petroleum Exporting Countries, joined nonmember Russia in the production freeze.
But it came with a significant caveat: Iran, Iraq and other big producers would also have to halt production increases. That could prove too much to ask, with the cartel that controls more than one-third of the world’s oil more fractured than ever by wars, heightened competition for market share, and low oil prices that have devastated members’ economies.
Iraq’s production has soared to a record 4.35 million barrels a day—second most in OPEC—as it furiously pumps to generate revenue to fight a war against Islamic State. An Iranian official said the country—recently unshackled from Western constraints on its oil—wouldn’t halt plans to double its exports to return to presanctions levels.
Those new barrels have moved into the market as Russian output hit a post-Soviet record in January, U.S. crude output stayed above nine million barrels a day and Saudi production hummed along at historically high levels.