Oil prices slid Tuesday as investor skepticism grew than the Organization of the Petroleum Exporting Countries would reach an agreement to limit production.
OPEC members are meeting in Algiers this week to discuss coordinated action to lift oil prices, which have been hammered in recent years by a persistent global glut of crude.
OPEC plans to discuss a proposal to cut almost a million barrels a day of the cartel's production over one year, people involved in the discussions told The Wall Street Journal on Tuesday. But Iran's oil minister said later in the day that he has met with Saudi Arabia and Russia and hasn't received an official proposal.
In addition, both the Saudi Arabian and Iranian oil ministers played down the talks and said the group is unlikely to reach a consensus this week.
U.S. crude oil recently fell $1.61, or 3.5%, to $44.32 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell $1.64, or 3.5%, to $45.71 a barrel on ICE Futures Europe.
Under the potential output proposal, Saudi Arabia would carry out the bulk of the reduction but Iran would have to agree to freeze its output at a lower level than the country has previously said it would consider.
The proposal, if agreed to, would represent the first concrete action taken by OPEC to prop up the market since oil prices crashed beginning in 2014. It would also represent a departure for Saudi Arabia, which has opened the spigots wide during the market slump in a fierce competition for customers with U.S. oil producers and others.
The proposal would also mark also a departure from recent talks by the group about freezing production, rather than cutting it. An effort in April to agree on a production freeze fell apart because Iran refused to participate.
However, any deal remains unlikely, Citigroup said in a note.
"The disparity between Saudi Arabia and Iran, in terms of what level of Iranian production is acceptable, will likely see talks at this meeting, or meetings in the near future fail," the bank said. "None of the current scenarios seem plausible."
Goldman Sachs on Wednesday cut its oil-price outlook to $43 a barrel in the fourth quarter, down from its previous forecast of $50 a barrel. An OPEC deal could boost prices, the bank said, but the oversupply of crude and the potential for increased output from Libya and Nigeria would continue to weigh on the market.
Gasoline futures recently fell 2% to $1.375 a gallon. Diesel futures were down 3.3% at $1.4012 a gallon.
Selina Williams and Georgi Kantchev contributed to this article.
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