– This is the script of CNBC's news report for China's CCTV on November 30, Monday.
Welcome to CNBC Business Daily, I'm Qian Chen.
The Organization of the Petroleum Exporting Countries will meet in Vienna on Wednesday aiming to implement a deal outlined in September to cut output by around 1 million barrels per day (bpd), from around 33.82 million bpd in October.
But Iran and Iraq were resisting pressure from Saudi Arabia to curtail oil production, making it hard for OPEC to reach an agreement. That has led some analysts to suggest the meeting may fail to reach a deal or produce one that is unworkable.
Documents prepared for a ministerial OPEC meeting on Wednesday propose the group cut production by 1.2 million bpd from October levels, an OPEC source familiar with the papers said.
The papers for the meeting also propose Saudi Arabia reduce production to
10.07 million bpd from 10.54 million bpd in October and that Iran freeze output at 3.797 million bpd, according to the source.
Iran's oil minister earlier on Tuesday said the country was prepared to leave its oil production at levels to which OPEC had agreed at its September meeting in Algeria.
OPEC said it would exempt Iran, Libya and Nigeria from cuts as their output has been crimped by unrest and sanctions.
The organization, which accounts for a third of global oil production, agreed in September to cap output at around 32.5-33.0 million barrels per day versus the current 33.64 million bpd to prop up oil prices, which have halved since mid-2014.
[TIM EVANS, Citigroup Energy Futures Specialist for Citi Futures] "With deadline coming up right in front of us, we may not see an agreement tomorrow, that's not a done deal yet, maybe they do put something together to save face tomorrow, but it's not clear that they are going to be able to reach an effective limit on production."
Intense negotiations would be needed on Wednesday to cement a deal, Goldman Sachs analysts said. If OPEC agreed to cut production to 32.5 million bpd, crude prices would likely rise to the low $50s a barrel, Goldman said.
"If no deal is reached, our expectation of rising (crude) inventories through the first half of 2017 would warrant prices averaging $45 per barrel through next summer," Goldman said.
Oil prices fell as much as 4 percent on Tuesday on signs leading oil exporters in OPEC were struggling to agree on a deal to cut production to reduce global oversupply.
CNBC Qian Chen, reporting from Singapore.