The OPEC leaders are scheduled to hold a meeting in Vienna today, where the 14-member cartel is widely expected to deliver a deal that would see production cuts from the cartel for the first time since the ‘Great Recession’ of 2008/09. The sentiment around the meeting got soured last night when Iran sent its ‘tit for tat’ proposal to OPEC secretariat.

Earlier this week, Saudi Arabia revealed its negotiating stance.

• The kingdom is ready to cut production by 4.5 percent, if Iran freezes output at 3.8 million barrels per day, below its pre-sanction levels. It also demanded that the countries would have to accept third party production figures gathered by the Secretariat. In addition to that, the Kingdom demanded that non-OPEC countries like Russia need to join in with cuts of their own. We analyzed that this deal is certainly feasible, as it would require less than 2 percent cuts from non-exempted members. However, it is up to Iran, whether to accept it or not.

Iran responded with a tit for tat proposal. In a letter to the OPEC secretariat, Iran demanded that Saudi Arabia cut its production to 9.5 million barrels per day, a level of November 2014. In October, Saudi Arabia produced 10.62 million barrels per day.

Oil price is treading water cautiously over this bitter rivalry between the Saudis and the Iranians. WTI is currently trading at $45.5 per day and Brent at $2.2 per barrel premium.