Business

LONDON — Global mining giant Anglo American announced Tuesday a "radical" restructuring of the firm that will slash its workforce by almost two-thirds, as commodity prices crash on world markets.

Some of the jobs will be transferred via asset sales, although Anglo will also write off billions of dollars owing to the closure of loss-making mines.

The prices of metals and other raw materials, notably oil, are sliding on markets owing to weak demand growth, in particular from the world's second biggest economy China.

Anglo's announcements, as part of its investor day, come as sector rival Rio Tinto said it would slash its spending next year owing to sliding metal prices.

In a statement, Anglo American Chief Executive Mark Cutifani said "the severity of commodity price deterioration requires bolder action".

The London-listed company said it expects "impairments of $3.7-$4.7 billion (3.4 billion euros and 4.3 billion euros), largely due to weaker prices and asset closures".

And Anglo said it plans to slash its workforce by almost two-thirds, from 135,000 staff to 50,000 after 2017.

The company published a graph showing the expected decline in jobs, to 99,000 next year and 92,000 in 2017 followed by another sharp reduction, via a combination of asset sales and internal cuts.

"We will be radically restructuring our portfolio, so the net result is expected to be a reduction to around 50,000 employees," a spokesperson confirmed in an e-mail to AFP. 

"But bear in mind that these include assets that we will sell, so the 85,000 jobs don't [all] disappear as many will be employed by new owners of those mines that we sell," he said.

Anglo has already been cutting jobs in recent years, with the workforce standing at 162,000 in 2013.

Simplified business 

Cutifani added that Anglo American plans to halve its business setup to leave just three components, its diamonds operation De Beers, Industrial Metals and Bulk Commodities.

"Anglo American is today setting out an accelerated and more radical restructuring programme to redefine the focus of its asset portfolio to transform the company's competitive position and create a more resilient business to deliver sustainable shareholder returns," the group statement said.

Delivering a blow to shareholders, Anglo said it would suspend dividend payments until the end of next year.

Anglo's share price slumped following the announcements, hitting an all-time low at 332 pence.

Approaching midday in London, it tumbled 8.4 per cent to 338 pence on the capital's benchmark FTSE 100 index, which was 0.7 per cent lower overall compared with Monday's close.  

Anglo added that it would further slash investment through to the end of next year by about $1 billion.

Earlier Tuesday, Rio Tinto said it planned to slash spending in 2016 by a similar amount to maintain profits in the face of the commodities price rout.

The weak demand situation has been worsened by a supply glut blamed on rising output by leading miners, including BHP Billiton and Rio.

Tumbling values for commodities, including Rio's main raw material iron ore, has massively increased the pressure on mining firms as prices approach break-even costs.

Rio said in a statement that capital spending for 2016 was expected to be around $5 billion compared to previous forecasts of less than $6 billion.

The figure was anticipated to reach $5 billion this year in contrast to previous estimates of $5.5 billion, the Anglo-Australian miner said.

The price of iron ore tumbled to $39.6 Tuesday, a multi-year low, after peaking near $200 a tonne in 2011.

"Our prudent capital allocation and disciplined approach to the balance sheet have reinforced our resilience during this period of ongoing volatility," Rio Tinto Chief Executive Sam Walsh said in a statement.

"With all of our investment decisions framed by the need to deliver value for shareholders, we have remained focused on investing in only the best-quality projects," he added.

Critics have said large miners such as BHP and Rio raise output despite falling prices to try to flood the market and drive smaller competitors out of business.

Rio Tinto shares were down a hefty 5.2 per cent and BHP Billiton plunged 5.1 per cent in London deals.

"With key benchmark commodity indexes below levels last seen in the 1990s, and Chinese demand set to remain weak, it is clear that commodity prices remain some way short of giving any evidence of bottoming out," said Michael Hewson, chief market analyst at traders CMC Markets UK.

GAZA — More than a decade after Israel and Europe rolled out 3G, Palestinians are preparing for the introduction of the mobile network, hoping better Internet access will give their economy a boost.

With 4.6 million Palestinians in Gaza and the West Bank, a burgeoning Internet sector and a very high usage of social media platforms such as Facebook and Twitter, demand for 3G is expected to be strong, even if it is a generation behind the 4G networks now in use in Israel and Europe.

Officials say the service will be a boon for consumers working remotely, including those stuck at Israeli checkpoints and needing to pay urgent bills or get work done.

After lengthy negotiations, Israel and the Palestinian Authority signed an agreement last month opening the way for the network, with services expected in the Israeli-occupied West Bank by the second half of 2016 and afterwards in Gaza.

Palestinian mobile operators Paltel and Wataniya have set aside a combined $150 million for the upgrade from 2G.

"The use of fast Internet, especially in the mobile sector, will contribute greatly to increasing gross domestic product," Palestinian Telecoms Minister Allam Moussa, told Reuters.

The Palestinian Authority's (PA) gross domestic product (GDP) totalled $12.7 billion in 2014, according to the World Bank. Studies indicate a 10 per cent increase in broadband use adds around 1 percentage point to GDP. With unemployment at 27 per cent, the Palestinian territories could do with the boost.

"It may inject $80-$100 million into the Palestinian economy every year," indicated Ammar Aker, chief executive of PalTel Group, calling it a rough estimate.

The PA already hosts a number of App designers, and new investment is expected to create jobs in the design and making of Apps and in the IT sector among others.

Describing a situation familiar to many Palestinians, former telecoms minister Mashhour Abu Daqqa talked up the advantage of 3G for consumers caught out by the frequent sudden closures of Israeli checkpoints.

"You can do all your business over the Internet while waiting for the crossing to open," he told Reuters. "An employee or a businessman would be able to finish his work while at home, in a cafe or anywhere."

Still, while cellular operators are pleased that Israel, which under interim peace accords effectively has a final say over allocating radio frequencies in the West Bank, has given the go-ahead, they are disappointed not to jump straight to 4G.

"From an investment point of view it would have been better for us," said PalTel's Aker. "But we would have needed another two years of negotiation."

Gaza delay

Though the agreement with Israel covers both the West Bank and Gaza, analysts expect it will only be introduced in the West Bank next year. Gaza, which is controlled by the Islamist group Hamas, will probably come later.

"The agreement does not specify a geographical area, which means in theory it applies to both," said Abu Daqqa, the former minister and an IT specialist. "But out of experience, Israel will not allow it to work in Gaza."

Haitham Abu Shaaban, Wataniya's director of operations in Gaza, said the company was ready to roll out services as soon as it had the green light from the PA.

"We are getting prepared to buy the equipment and put together the required commercial plans," he added.

Like billions of people around the world, Palestinians are rarely away from their phones.

There is some resentment that, with Israel having introduced 4G this year, the Palestinians are lagging, although some Palestinians retain a sense of humour about it.

"It seemed as if it was meant to be like this: 4G in Israel, 3G in the West Bank and 2G in Gaza," said one official.

LONDON — Brent crude prices sank under $40 on Tuesday for the first time in almost seven years, rocked by the Organisation of Petroleum Exporting Countries (OPEC) with a recent decision to maintain oil output levels despite a chronic supply glut.

Sentiment was also soured by weak demand growth, the strong dollar and a broader collapse in other commodity markets.

European benchmark oil contract Brent North Sea oil for delivery in January tumbled to $39.81 per barrel, the lowest point since February 2009.

"After the OPEC decision, or should that be indecision, last week, the question was not if but rather when this would occur," said ETX Capital analyst Daniel Sugarman, in reference to Brent's latest slide below $40.

New York's West Texas Intermediate (WTI) for January also hit a similar low at $36.64 a barrel on Tuesday, having already breached $40 last week.

Crude futures had also slumped on Monday after the OPEC oil producing group refused on Friday to slash record high output, in a market dogged by oversupply.

"If Brent holds below $40 a barrel, this would be another psychological blow for the sellers, which could lead to further falls as the buyers grow more and more in confidence," added Gain Capital analyst Fawad Razaqzada.

"But oil prices have already dropped very sharply in the space of 2.5 trading days, so the selling pressure could start to at least ease going into the second half of the week."

A stubborn supply glut, and weak demand growth fuelled by China's economic slowdown, have combined to send crude prices collapsing by more than 60 per cent over the past 18 months from levels above $100 a barrel.

Traders, meanwhile, are looking ahead also to a meeting of the US central bank's Federal Open Market Committee (FOMC) next week, amid expectations that it will announce its first interest rate hike in more than nine years.

An interest rate increase typically boosts the dollar, which would make dollar-priced oil more expensive to holders of weaker currencies. 

The Federal Reserve announces its latest monetary policy decision on December 16.

"Oil is of course the big story and is likely to be as we run up to the FOMC next week," said GKFX analyst James Hughes.

He added: "It seems that whatever happens OPEC will not budge."

SYDNEY — Australia will introduce a new entrepreneur visa and offer tax breaks for start-ups, the government said Monday, as it seeks to unleash an "ideas boom" and move the economy away from its dependence on mining.

Launching a signature A$1.1 billion ($806 million) innovation agenda, Prime Minister Malcolm Turnbull said Australia needed a "dynamic, 21st century economy" underpinned by creativity.

"This is all about unleashing the ideas boom," he told reporters in Canberra.

"Unlike a mining boom, it is a boom that can continue forever, it is limited only by our imagination."

Australia has enjoyed more than 20 years of economic growth, but an unprecedented mining investment boom is now fading, commodity prices are dropping and government revenues are falling.

Turnbull, a tech-savvy former businessman who became prime minister in September after beating his conservative Liberal Party colleague Tony Abbott in an internal ballot, said innovation was critical to the next wave of prosperity.

Australia lagged in terms of commercialising ideas, consistently ranking last or second last among OECD countries for business-research collaboration, he said, meaning a big cultural change was needed to turn things around.

"Our appetite for risk is lower than in comparable countries, which means Australian start-ups and early stage businesses often fail to attract capital to grow," Turnbull said.

To help fix this, new tax breaks for early stage investors in start-ups will be offered, giving them a 20 per cent non-refundable tax offset based on the size of their investment, as well as a capital gains tax exemption.

Insolvency laws, which currently focus on penalising and stigmatising business failure, will also be reformed.

"We understand that sometimes entrepreneurs will fail several times before they succeed — and will usually learn more from failure than from success," Treasurer Scott Morrison said.

Turnbull said there would be no cap placed on the number of new entrepreneur visas designed to attract innovative talent, while changes would also be made to retain high achieving foreign students.

"The more high-quality, effective, productive enterprising entrepreneurs we can attract, the better. Because they drive jobs," he said.

School students will be encouraged to learn coding and computing while the government will also establish an A$200 million innovation fund at national science body CSIRO to co-invest in new spin-off firms.

AMMAN — Jordan Industrial Estates Company (JIEC) Chief Executive Jalal Al Debei on Monday was briefed about demands of investors during a field visit to the King Abdullah II Industrial Estate.

At a meeting held at the Jordan Investors Association (JIA), Debei urged the members of the association to voice their suggestions and current and future visions to improve services offered to industrial investors in the King Abdullah II Industrial Estate. JIA president and members of the board of directors spoke about several issues related to industrial investment in the estate to be followed up by JIEC.

JIA Vice Chairman Mohammad Al Saghayer said that despite the challenges pressuring the industrial sector because of regional issues and the closure of some neighbouring markets, in addition to increased energy prices, the industrialists of the estate were able to continue their economic activity.

AMMAN — Royal Jordanian (RJ)  inaugurates its new direct regular route from Amman to the Turkish capital, Ankara, on Tuesday, according to an RJ press statement. "RJ is expanding its network in Turkey by adding the Ankara route to that of Istanbul," RJ President/Chief Executive Officer Suleiman Obeidat said  in the Monday press release.

"This route is bound to cater for the demand of business traffic between the capital of Turkey and both Jordan and beyond. It will also serve Hajj and Umrah pilgrims." Ankara and its vicinity are important regional centres for trade and commerce, he said. 

The chief executive officer  added that the new addition to the route network brings the number of RJ destinations to 55, pointing out that new destinations will be added to the RJ route network within the coming few weeks.

Also, RJ passengers flying from/to Amman can continue their travel to more than 1,000 destinations served by RJ’s partners in the oneworld airline alliance. Royal Jordanian will operate to Ankara three times a week, on Thursdays, Sundays and Tuesdays bringing the number of flights between Jordan and Turkey to between 12 and 17 weekly, depending on the seasonal demand.

ATHENS — The Greek parliament approved a 2016 budget featuring sharp cuts in spending and some tax increases to satisfy the country's international lenders at a time of growing austerity fatigue.

The leftist-led government of Prime Minister Alexis Tsipras is under pressure to deliver tangible benefits to its poorest citizens after having signed to a third rescue package from eurozone governments in August worth up to 86 billion euros.

The budget makes 5.7 billion euros ($6.2 billion) in public spending cuts including 1.8 billion from pensions and 500 million from defence. The savings are greater than this year's 1.5 billion euros. It also included tax increases of just over 2 billion euros.

It was passed by 153 votes to 145 with two members absent.

"This budget is a difficult task for a government that wants to leave its mark with social justice," Tsipras told lawmakers just before the vote.

He stressed that for the first time in five years, spending on hospitals, social welfare and job creation was being increased modestly within the bailout's constraints.

Tsipras said that was possible because his government had secured greater fiscal space by reducing its primary budget surplus target before debt service to 0.5 per cent of the gross domestic product (GDP) in tough negotiations with the creditors.

The budget will have a deficit of 2.1 per cent of GDP next year compared with 0.2 per cent this year.

 Tsipras' coalition majority fell to three last month after two lawmakers rebelled against a set of reforms demanded by the lenders, raising questions about his ability to push through a more ambitious long-term reform of the country's complex, under-funded pension system next month.

Representatives of the eurozone, the European Central Bank (ECB) and the International Monetary Fund (IMF) return to Greece on Monday for more talks about pending reforms of the pension and tax systems and public administration.

Having recapitalised the countries' four systemic banks at less expense to the taxpayer than expected, the government aims to complete a first review of the latest bailout programme in February in order to open promised talks on long-term debt relief from eurozone governments.

For the centre-right opposition, interim New Democracy Party leader Yiannis Plakiotakis said: "Syriza's first national budget proves that what they have been saying about social sensitivity is just a myth. The budget shows that 2016 will be much worse than 2015."

Greek Finance Minister Euclid Tsakalotos told Reuters in an interview on Saturday that a long-term commitment from eurozone partners to debt relief is crucial to restore investors' confidence in Greece and "lay the Grexit dragon to rest once and for all".

The soft-spoken leftist academic, who replaced Yanis Varoufakis in July when Greece was on the brink of being bounced out the euro, has worked to rebuild shattered trust among euro area finance ministers by faithfully implementing the country's third bailout plan.

While his predecessor had a turbulent relationship with  fellow ministers, Tsakalotos has focused on building a record of delivering on undertakings made under the bailout deal more or less on schedule before presenting demands to his peers.

Even German Finance Minister Wolfgang Schaeuble, a sceptic who tried to force Greece to take a long "time out" from the eurozone at the height of the debt crisis last summer, has been heard recently to praise reform efforts and new-found cooperation between Athens and its creditors.

Asked if a Greek exit from the euro was still a risk, Tsakalotos said: "If the roadmap of the Greek government to complete the recapitalisation of the banks and complete successfully the first review of the [bailout] programme is followed, and we get a serious discussion and solution on debt, then ... I think that will lay the Grexit dragon to rest once and for all."

Consumers, businesses, depositors and investors needed long-term certainty about the sustainability of Greece's debt burden, which is expected to reach 186 per cent of annual GDP next year — to restore their confidence, he said.

Debt relief

The leftist government swept to power in January, promising to reverse years of austerity demanded by Greece's creditors that helped to push the economy into a long depression.

With Greek banks near collapse, Athens had to impose capital controls on deposit withdrawals and international transfers in July and accept creditors' demands for more austerity and reform by agreeing to the third bailout programme in August.

However, the government is continuing to press for relief on Greece's huge debt burden.

Tsakalotos hinted at the parameters of a debt relief negotiation he said was likely to start in February, saying that capping the country's annual gross funding needs by extending loan maturities and grace periods before payment of interest and principal have to begin could be a good solution.

Jeroen Dijsselbloem, who chairs meetings of eurozone finance ministers, told Reuters in October that the governments of the currency bloc agreed that Greece's debt service costs should be capped at 15 per cent of GDP a year over the long term.

Asked about that idea, Tsakalotos said: "Fifteen per cent is a very large number if it doesn't include T-bills, but if it does include T-bills it is something that is very well worth considering. So that is quite a big issue."

One source close to the creditors poured cold water on the idea. Asked if short-term treasury bill debt could be included in a country's gross funding costs when the IMF and European Union (EU) calculate its debt sustainability, the source said: "No, T-bills are not included in the financing needs calculations."

Tsakalotos accepted in principle that long-term debt relief would be conditional on continued progress on reforming the Greek economy, with monitoring by the creditors.

"It depends on the nature of the benchmarks and the nature of the conditionality," he said. 

"At some point the creditors have to decide whether they trust the Greek government. Because if they do not trust the Greek government and the Greek government is always going to have to be on a tight political leash, then the implications of that are that we will never get out of the crisis," Tsakalotos added.

The IMF considers 15 per cent of GDP to be a normal debt service level for an advanced nation, but given Greece's economic weakness, an IMF source said in October that a cap of 10 per cent of GDP would be more appropriate.

Treasury bills are the government's main source of short-term funding since it was shut out of capital markets and forced to seek the bailouts.

The ECB has limited Greece's total borrowing through T-bills to 15 billion euros ($15.84 billion), about 7 per cent of GDP. That would mean the government would need to allocate another 8 per cent of GDP to service longer-term debt, close to the level envisaged by the IMF source.

Athens faces debt service costs far below the EU average until 2022 because it was granted a 10-year holiday on principal repayments on most of its debt to the eurozone in 2012, but they will spike from 2022 unless smoothed out.

Tsakalotos said locking in manageable annual debt service costs over the long term would give investors a "clear runway".

"Because if they only get a solution for one year, they will only invest for one year. If they only get a solution for two years they are only going to invest for two years," he added.

Return to growth

He forecast a return to economic growth in the second half of 2016 and a complete lifting of capital controls after a shallower-than-expected recession due to this year's political turmoil.

Asked when he thought Athens might be able to start borrowing on the bond market again, Tsakalotos said: "I don't think it's impossible by the end of 2016. I wouldn't bet my life on it but I think it's at least a 50-50 bet."

Since July, he has overseen a recapitalisation of banks hard hit by the capital controls to stop deposit flight, and pushed through seven sets of unpopular legislation required to obtain a first cash release from the eurozone creditors.

Tougher assignments lie just ahead, including a potentially explosive overhaul of Europe's most expensive pension system in the coming weeks which provoked a general strike on Thursday.

The government's parliamentary majority has shrunk to three and public tolerance for further belt-tightening is wearing very thin after the six years of austerity.

Tsakalotos said the government would nevertheless manage to pass the ambitious pension reform next month, but it aimed to avoid further pension cuts in 2016 despite a requirement in the bailout deal to save 1 per cent of GDP on pension costs next year.

Asked how he could square that circle, he said: "We will have to find savings without cuts, obviously." He declined to say if that meant raising contributions, saying he wanted to discuss the reform first with employers and trade unions.

"We really have got reform fatigue and it's absolutely critical that people start seeing some of the benefits so that the reforms do not lose momentum," Tsakalotos concluded.

LONDON — Emerging economies not long ago deemed at risk of crisis are seeing steady balance of payments improvements, while for oil exporters in the Gulf and elsewhere once-mighty cash surpluses have all but melted away.

The so-called taper tantrum of mid-2013 unleashed a wave of selling of assets from developing countries whose big funding or current account deficits left them vulnerable to the withdrawal of cheap money resulting from a slowdown, or taper, in the rate of US money printing.

With oil prices at the time over $100 a barrel these tended to be fast-growing energy importers such as India and Turkey, which, along with Indonesia, Brazil and South Africa, were lumped together as the Fragile Five.

But thanks to the halving of oil prices since mid-2014 and sharply weaker exchange rates, gaps are narrowing.

India's deficit has shrunk to 0.9 per cent of annual economic output this year, according to data compiled by JPMorgan, while Ukraine should post a surplus versus an 8 per cent gap in 2012.

Others have improved less, with Turkey running a 5.2 per cent deficit this year and Brazil, despite economic recession, seeing a bigger deficit than in 2012 at 3.4 per cent.

"Lower oil prices are clearly helping to move trade balances so this is positive," UBS strategist Manik Narain said.

"However, none of the current account improvements have come through stronger exports," he said. "Governments have inflicted quite a lot of pain on domestic demand to get the current accounts under control," he added.

But if oil and currency adjustments are shrinking some deficits, commodity-reliant countries with fixed exchange rates are seeing the opposite.

Venezuela's 2.9 per cent surplus in 2012 for instance has swung into an 8.1 per cent deficit. There are also dramatic declines in the Middle East, where the six Gulf Cooperation Council (GCC) countries will run a 3.8 per cent surplus this year, down from 22 per cent in 2012 and 13.2 per cent in 2014.

Oil earnings this year for the bloc comprising Saudi Arabia, Kuwait, Qatar, Oman, Bahrain and the United Arab Emirates will be $275 billion less than 2014, according to the International Monetary Fund.

Moreover, all GCC currencies except Kuwait peg their currencies tightly to the dollar. So with little relief on the exchange rate front, governments will need to slash budget spending to dampen import demand.

Jason Tuvey, Middle East economist at Capital Economics says the headline surplus is down to Kuwait and Qatar, which mask a Saudi deficit of as much as 7 per cent of the gross domestic product (GDP). Smaller Oman and Bahrain have even bigger funding gaps.

While some reckon governments will have to loosen currency pegs, Tuvey reckons spending cuts are more likely, noting that Saudi Arabia reacted to the 1980s oil price collapse by slashing capital spending more than 98 per cent.

"A repeat of this would wipe out the budget deficit and push the current account position back into a sizeable surplus," he said.

Other oil exporters which allowed their currencies to weaken have fared better, with Russia's surplus at 5 per cent of GDP compared with 3.5 per cent in 2012.

Malaysia's surplus has halved since 2012 but with the ringgit almost 30 per cent weaker since the taper tantrum, there may be signs of a turnaround, imports are contracting and data on Friday showed exports growing twice as fast as expected.

AMMAN —  Jordanian Free Zones Corporation Chairman Nasser Shraideh expects the free zone at the Queen Alia International Airport (QAIA) to attract JD380 million of new investments and increase exports by JD750 million during the first three years, according to an Amman Chamber of Commerce (ACC) statement said Sunday.

Shraideh made his remarks during a meeting with ACC President Issa Murad, attended by several heads of Jordanian commercial chambers and representatives of commercial sectors.

Shraideh said the zone will provide 3,500 direct job opportunities and 4,000 indirect ones that will stimulate the national economy as the zone will also help meet local market demands through entering regional markets and being a logistic area for exporting and importing. Murad said the launch of the free zone in QAIA comes in response to Royal directives to support national investments.

VIENNA — Members of the Organisation of Petroleum Exporting Countries (OPEC) failed to agree an oil production ceiling on Friday at a meeting that ended in acrimony, after Iran said it would not consider any production curbs until it restores output scaled back for years under Western sanctions.

Friday's developments set up the fractious group for more price wars in an already heavily oversupplied market.

Oil prices have more than halved over the past 18 months to a fraction of what most OPEC members need to balance their budgets. 

The hands-off decision pushed US oil back below $40 a barrel on Friday, after closing at the level Wednesday for the first time since August.

US benchmark West Texas Intermediate tumbled $1.11, or 2.7 per cent, to $39.97 a barrel on the New York Mercantile Exchange.

Brent North Sea crude for January delivery, the international benchmark for oil, fell to $43 a barrel in London, down 84 cents (1.9 per cent) from Thursday's settlement.

"The market did not take the announcement out of OPEC very well today as OPEC appears to really be in disarray among its members and they took the path of least resistance, which was to do nothing and wait to see if things get better," said Andy Lipow of Lipow Oil Associates.

James Williams at WTRG Economics said the prolonged interval before the next OPEC meeting indicates "they do not seem to think that there will be an agreement this spring."

"By then, they have a better feel for Iranian production; how much damage has been done to shale production; and how many offshore and oil sands projects have been delayed or scrapped," Williams added.

Banks such as Goldman Sachs predict they could fall further to as low as $20 per barrel as the world produces more oil than it consumes and runs out of capacity to store the excess.

A final OPEC statement was issued with no mention of a new production ceiling. The last time OPEC failed to reach a deal was in 2011 when Saudi Arabia was pushing the group to increase output to avoid a price spike amid a Libyan uprising.

"We have no decision, no number," Iranian Oil Minister Bijan Zangeneh told reporters after the meeting.

OPEC's Secretary General Abdullah Al Badri said OPEC could not agree on any figures because it could not predict how much oil Iran would add to the market next year, as sanctions are withdrawn under a deal reached six months ago with world powers over its nuclear programme.

"We cannot put a number now because Iran is coming, we don't know when Iran will come, and we will have to accommodate Iran one way or the other," said Al Badri. 

"We decided to postpone this decision to the next OPEC meeting [in June] until the picture will be more clearer for us to decide on a number," he added.

Most ministers left the meeting without making comments.

Badri tried to lessen the embarrassment by saying OPEC was as strong as ever, only to hear an outburst of laughter from reporters and analysts in the conference room.

‘Everyone welcome’

A year ago, Saudi Arabia pushed through an OPEC decision to defend market share instead of cutting output, ultimately hoping to drive high-cost producers such as US shale firms out of the market.

Many poorer OPEC members have said the group's largest producer was effectively twisting their arms, prompting Saudi Oil Minister Ali Al Naimi, to say he would listen to everyone this time.

 Iran has made its position clear ahead of the meeting with Zangeneh saying Tehran would raise supply by at least 1 million barrels per day (bpd), or 1 per cent of global supply, after sanctions are lifted. The world is already producing up to 2 million bpd more than it consumes.

Naimi earlier had said he hoped growing global demand could absorb an expected jump in Iranian production next year: "Everyone is welcome to go into the market."

He made no comment after the meeting.

At the meeting, OPEC welcomed back returning member Indonesia, its 13th member. The group accounts for about a third of world oil output and does not include Russia or the United States, which rival Saudi Arabia as the world's biggest producers.

"The pressure will build on OPEC and oil prices. At this rate of overproduction we will run out of onshore storage in the first quarter," indicated Gary Ross, a veteran OPEC watcher and the founder of PIRA think tank.

‘Dysfunctional family’

Initially on Friday there was no indication of a repeat of the 2011 meeting, which Naimi had called the "worst ever".

OPEC sources told Reuters the ministers had agreed to roll over existing policies during the first couple of hours of deliberations. That involved raising the collective ceiling, excluding new member Indonesia, to 31.5 million bpd from the previous 30 million, effectively bringing it in line with real production numbers.

But later, all decisions appeared to have been overturned, leaving the group with no official policy. It was not immediately clear what happened behind closed doors.

"Now the Viennese OPEC family gathering is over, the music has stopped and they're sweeping up, but nothing has changed," said Christopher Wheaton, energy fund manager and analyst at Allianz Global Investors

"The oil production remains unchanged, the oil production quota remains divorced from real-world oil production, and the slightly dysfunctional OPEC family, like most families, has gone its separate ways," he added.

OPEC President and Nigerian Oil Minister Emmanuel Ibe Kachikwu said a reduction "is not going to make much of an impact in the market".

"We have said on more than one occasion that we are willing to cooperate with anyone that will help balance the market with us," Naimi told reporters gathered at OPEC headquarters in Vienna.

"Everyone is concerned about... the prices, no one is happy," said Iraq's Oil Minister Adil Abd Al Mahdi.

Indonesia's re-entry will "simply acknowledge the reclassification of Indonesian output from non-OPEC to OPEC production", said Julian Jessop, analyst at Capital Economics research group. "It would not amount to an increase in overall global supply."

OPEC, whose members face pressure from cleaner fuel technologies, also had a word for the Paris climate summit.

OPEC's final communique stated that "climate change, environmental protection and sustainable development are a major concern for us all".