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Best oil deal from Doha likely to underwhelm

Despite the hype, this weekend's meeting of oil producing nations in Doha, Qatar, may result in a flimsy agreement with no real impact on crude supply.

Oil prices have gained sharply over the past two months on high hopes that the Sunday meeting of OPEC and non-OPEC countries will result in a deal to freeze crude production at January levels. But oil analysts now expect to see what seems more like the outlines of a deal, rather than an accord itself.

"I think it will be a very loosely worded agreement," said John Kilduff of Again Capital. "I think it's going to be transparent there is no deal."

Edward Morse, Citigroup global head of commodities research, said there could be an accord but it will lack in detail and commitment. "I think at best, it's going to be a very soft agreement," he said. Morse said the group could also announce that it has a follow-up meeting, but no binding deal is expected.

Oil prices have risen about 60 percent since Russia, Saudi Arabia, Qatar and Venezuela agreed in February to freeze output if other producers would join them. Russia's energy minister, Alexander Novak, reportedly told a closed-door briefing of energy analysts this week that a deal would be more of a framework, without specifics.

"I do not expect to see a firm agreement coming from Sunday's meeting. I think kicking it down the road to some future deal is the best we're going to get ... kicking it down the road and hoping the oil market fundamentals improve enough," said Chris Weafer, senior partner at Macro-Advisory. "When this started, the oil price had dipped below $30. They had to do something and creating optimism has worked very well, and it has had traders building long positions."

The sharp drop in oil prices has stung producing...