Research Team at Societe Generale, lists down the possible implications of the failure of the freeze talks for the oil markets. Key Quotes Neutral for fundamentals: Our expectation (and the markets) was that if there would have been a freeze, it would have excluded Iran, so there would have been no impact on real physical crude supply going forward. Therefore, the fact that there is no freeze doesn’t make any difference; there is no impact either way. Bearish for market psychology, and the price drop might have already happened: Crude prices could quickly increase or decrease by as much as $3-5. As noted above, prices did indeed drop by $3 in early Monday trading. However, two new short-term bullish supply disruptions – a big one in Kuwait and a smaller one in Nigeria – offset the Doha news and helped prices to quickly recover on Monday. It is possible that the market has already moved on from Doha, from a psychological perspective, and has quickly returned to focusing on the fundamentals. Bearish for market psychology, and further price weakness still possible: It is also still possible that some moderate and perhaps more persistent price weakness will emerge as a result of the Doha failure. The constructive interpretation of a successful freeze agreement would have been that, despite the lack of any impact on real supply, at least OPEC countries and Russia were all talking to each other, a positive development. Moreover, a freeze excluding Iran might have been followed by a freeze including Iran, after Iran reached its 4 Mb/d target or hit a plateau close to it. This interpretation was at least partially priced in, and it may be too early to say that the market has already moved on, just because of Kuwait and Nigeria.” For more information, read our latest forex news.