Why OPEC & some producers outside the group possibly to freeze output ?

Qatar Gulf News – Doha, Qatar, Thursday 25 August 2016. OPEC and some producers from outside the group may agree to freeze output during informal talks next month, which could prove “self-defeating” because it would benefit other suppliers, according to Goldman Sachs Group Inc.
A deal would show signs of cooperation from Saudi Arabia’s new energy minister after six failed attempts, Goldman analysts including Damien Courvalin said in a report dated August 22. An output cap would likely prove counter productive for the Organisation of Petroleum Exporting Countries if it led to further price gains and an increase in supply from other producers, it said.

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“Thawing relationships between parties in conflict in areas of disrupted production would be more relevant to the oil rebalancing than an Opec freeze, which would leave production at record highs,” Goldman said. “A production freeze would also likely prove self-defeating if it succeeded in supporting oil prices further, with the US oil rig count up 28% since May.”
Oil climbed more than 20% to enter a bull market last Thursday amid speculation talks in September may lead to action to stabilise the market. Opec is on course to agree to a freeze because its biggest members are pumping flat-out, according to Chakib Khelil, former president of the group. A similar plan was proposed in February, but a meeting in April ended with no accord.
Saudi Arabia and Iran continue to focus on market share and appear unlikely to unilaterally accept a freeze, Goldman said. Supply will remain the driver for oil prices in coming weeks, with no evidence demand growth is weakening, the bank said. Uncertainty about the sustainability of supply gains from Iraq, Libya and Nigeria and the magnitude of these improvements “remain large.” Goldman maintained its $45 a barrel to $50 a barrel forecast through next summer and reiterated that the price and fundamental recovery remain fragile.
Opec’s secretary-general will visit members Iran and Qatar next month, just weeks before the group holds informal talks in Algeria, according to a person with direct knowledge of the matter, Bloomberg reported . Mohammed Barkindo, who became the organisation’s chief diplomat this month, met earlier this week with Venezuelan Energy Minister Eulogio Del Pino, said the person, who asked not to be identified as the discussions were private. Del Pino, who has pushed the group to take action that would revive crude prices, has been touring oil-producing countries.
The Organisation of Petroleum Exporting Countries will meet in Algiers during an industry conference scheduled for September 26 to 28. Oil prices have gained 13% in the past two weeks.

Sources: QGN, Reuters, QGA, BBC, Doha News, Gulf Times, CAYE Global News, CCN News, NNC Global.