Many people in the U.S. have been enjoying cheaper gasoline prices recently. Gone are the gas prices that exceed $3-$4 per gallon at the pumps. This is mostly in thanks to the huge gas surplus that is out in the world. As of last month, Russia was pumping at a 30-year high at 10.91 million barrels per day. Currently, barrels of oil are being priced at the mid $30 per unit range. This is the lowest it’s been in over 10 years, the last time we had prices per barrel this low was back in 2003. Russia however believes the oil market needs to be stabilized meaning they want to reduce the surplus of oil effectively giving them, and all other oil producing countries, the upper hand in energy export negotiations. A Russian Energy Minister confirms this leaked quote, “The level of $45-50 (per barrel) is acceptable from the point of view of market balance: if prices go higher shale oil production could start to recover.”

All the big oil producers are planning to meet in Doha on April 17th to reach an agreement on halting all oil production until the surplus on the oil market is curbed. There will potentially be 17 nations coming to the meeting including Russia, Venezuela, Kazakhstan, Azerbaijan, Qatar and Saudi Arabia. Nations like Russia and Venezuela depend heavily on energy revenues to maintain their country’s national budget. The surplus on the oil market means they are in danger of destabilizing their economy. This makes sense when you realize oil prices fell from $115 to $40 per barrel in just two years. Iran is the dark horse in this deal. They haven’t been able to export oil for years because of sanctions which have finally been lifted this year. Iran wants to return to pre-sanction levels of oil exportation before they even want to consider a freeze. Russia has said that they might have to go through with a freeze deal without Iran. An Energy Minister from Russia was quick to clarify that the potential Doha deal would limit production of oil not the exportation of already pumped oil. Though another source said, “A cut in production was not discussed as it is hard to implement and may lead to a sharp jump in prices, causing a new wave of output activation at more costly fields.” Clearly different sides have different thoughts on the upcoming agreement.