(Repeats column published earlier with no changes to text. The opinions expressed here are those of the author, a columnist for Reuters.)

By Clyde Russell

LAUNCESTON, Australia, Aug 18 (Reuters) - Asking whether the world's major crude oil-exporting countries can reach a deal to limit output is probably the wrong question. Asking whether it matters if they do is more relevant.

Once again the speculative "will they, won't they" merry-go-round has been fired up ahead of a planned meeting of the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers.

As in the run-up to previous meetings, investors and traders will hang on every twist and turn in the words of oil ministers in the six weeks between now and the meeting at a forum in Algeria on Sept. 26-28, trying to work out if a deal is likely.

While this is interesting and will keep the media and analysts occupied, it's likely only to exert short-term influences on oil prices and increase volatility.

It's a more pertinent exercise to ask what will happen if the producers do manage to reach a deal, having failed in their previous six attempts.

There is certainly increased motivation for a deal to be reached, as the ongoing weakness in oil prices is causing rising fiscal pain for many producers. Some, such as Venezuela are teetering on the brink of social collapse, and others are eating through monetary reserves.

Still, given the inherent tensions between even fellow OPEC members such as Saudi Arabia and Iran, and the disparate nature of a group that includes outsiders as well, achieving a workable consensus in Algeria will be a challenge.

The price of global market Brent crude LCOc1 has jumped 20 percent since hitting a four-month low on Aug. 2 to close near $50 a barrel on Wednesday, reflecting some optimism the producers will be able to agree on limiting output.

The price is still below the peak so far this year of $52.86 on June 9, and is less than half of what it was in June 2014, when the last big downturn started.

However, assuming that some sort of agreement is reached in Algeria, what becomes important is the nature of the deal.

The consensus view is that any agreement would likely be a weak pact that did little to alter the supply-demand balance in the short to medium term, but that may tighten the market from late 2017 onwards on the basis that supply would remain flat while demand eventually rises.

Any agreement that allows major oil producers to continue pumping at current rates - near records for some - will merely serve to confirm that supply will remain robust.


The top producers in the Middle East have all been ramping up output recently, with industry sources quoted by Reuters saying number one exporter Saudi Arabia may pump record volumes in August.

Saudi Arabia's oil shipments, as tracked by Thomson Reuters Supply Chain and Commodities Research, are likely to be around 33.22 million tonnes in August, equivalent to about 7.82 million barrels per day (bpd).

This figure is still subject to the possibility of more vessels departing, but even if it stays the same, the final number will be similar to what was shipped in July, which was the second-highest monthly total since the beginning of 2015.

Saudi Arabia's average monthly exports since the start of 2015 are around 31.1 million tonnes, and the six months from March to August have all seen totals higher than this average, according to the Thomson Reuters data.

Iran's August shipments have been estimated at 10.477 million tonnes, the highest since Western sanctions against the Islamic republic were lifted in January and about 60 percent higher than the average since the beginning of 2015.

Regional rival Iraq is slated to ship 14.457 million tonnes in August, the most since April and above its average of 13.43 million since January 2015.

The United Arab Emirates is expected to ship 12.43 million tonnes in August, the third-highest since January last year and above the 11.56 million average of the last 20 months.

Thus, the overall picture that emerges from the major Middle East producers is one of plentiful and rising supply, meaning that merely freezing output is unlikely to do much to remove the overhang of crude in the market.

Also, the gains in output ahead of the September meeting are unlikely to sit well with those who have been battling to keep up their production, such as Venezuela and Nigeria, or those who have been largely steady, such as Russia and Angola.

Even if an agreement is reached in Algeria to freeze output, it may be self-defeating as any increase in crude prices will merely encourage producers not party to the deal, such as U.S. shale and Canadian oil sands companies, to boost output.

Unless the OPEC and non-OPEC producers can come up with an agreement that changes the structural dynamics of the oil market, it's hard to see anything more than a fleeting impact, deal or no deal. ((clyde.russell@thomsonreuters.com)(+61 437 622 448)(Reuters Messaging: clyde.russell.thomsonreuters.com@reuters.net))