WASHINGTON, April 18 (UPI) -- Crude oil prices were sharply lower Monday, a day after a production meeting collapsed in Doha, but movement was buffered somewhat by Kuwaiti labor strikes.
Crude oil prices in overnight trading were off by as much as 7 percent after a long-anticipated meeting in Doha ended Sunday without a deal to freeze production. Rumors of a deal to keep output at January levels helped drive oil prices back above the $40 per barrel mark, though doubts of an agreement started surfacing last week.
Ann-Louise Hittle, head of the Macro Oils division at analysis group Wood Mackenzie, said in response to email questions the results of the meeting were never really in doubt.
"The meeting outcome wasn't a surprise because positions were clearly delineated ahead of time although it has triggered a moderate pullback from recent price highs," she said.
Saudi representatives at Doha said an agreement was impossible without Iran, which has long said it was working to regain a market position lost to sanctions pressures. Mohammed bin Salman, the deputy crown prince of Saudi Arabia, told Bloomberg News on April 1 a deal was possible only "if all countries agree."
Brent crude oil was down by 4 percent at the start of the trading day in New York to $41.34 per barrel. West Texas Intermediate, the U.S. benchmark for the price of crude oil, was off 4.4 percent early in the Monday session to $38.57 per barrel.
Monday's trajectory was balanced by a labor strike hitting the Kuwaiti oil sector for the second straight day. Laborers started a general strike Sunday to protest expected austerity measures that could emerge in part as a result of lower crude oil prices. The Kuwaiti government said most of its operations were on line and in full swing as emergency strike countermeasures entered into force.
Crude oil prices may face further economic headwinds as China reports one of its lowest growth rates for first quarter gross domestic product in a decade. The Chinese Central Bank said Monday it was injecting another $25 billion into the financial system in an effort to help banks maintain liquidity.