Should you buy BP plc and Royal Dutch Shell plc following OPEC's latest meeting?

After a spritely start to the day and hiking back above the $50-per-barrel marker, Brent prices have reversed in Thursday afternoon trading as OPEC members yet again failed to implement a production ceiling.

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Ministers of the oil rich nations met in Vienna today, but once again disappointed the market by failing to hammer out a deal. This follows on from a Saudi-led initiative earlier in the year to freeze OPEC output with Russia to soothe the chronic supply imbalance denting the crude market.

Output curbs appear as far away as ever, particularly as several members look to turn the pumps up. Iran for one has said that it plans to keep hiking its own production until total output hits pre-sanction levels, a programme not expected to end until well into 2017.

All eyes will now turn to OPEC's next meeting scheduled for the end of November. But I expect the colossal commercial and political considerations to keep a group-wide accord firmly on the back-burner.

Soaring supply

Indeed, today's news comes as little surprise, the political and economic fault lines crossing OPEC as pronounced as ever. However, I believe the market is still failing to fully digest the impact of the ongoing inertia by the world's major producers to tackle the oil supply glut.

Despite the positive impact of recent supply disruptions in Nigeria and Canada, global crude inventories still stand around record levels. And a co-ordinated rowing back of production across the world is needed given the slow pace of demand growth.

And crude prices could receive a hefty shock should China's economic 'hard landing' intensify in the months ahead, casting a further cloud over future consumption levels.

Battening down the hatches

Naturally, OPEC's latest failure does oil majors like BP(LSE: BP) and Shell(LSE: RDSB) few favours.

Despite Brent's remarkable recovery from January's troughs, the prospect of fresh oil price pain has forced both firms to introduce further cost reductions in recent months. Indeed, BP and Shell are stepping up plans to streamline their workforces, while also significantly scaling back their capital expenditure budgets and hiving-off assets.

These measures are of course a wise decision in the current climate. But these moves seriously undermine BP or Shell's long-term earnings prospects when the supply/demand imbalance eventually eases and crude prices march solidly higher again.

Risks outweigh rewards

In the meantime, Shell is anticipated to endure a 37% earnings slide in 2016, resulting in a P/E rating of 22.3 times.

And although BP is expected to bounce back into the black with earnings of 18.6 US cents per share, the fossil fuel leviathan still deals on an elevated P/E rating of 28.6 times for this year.

Given the danger of a fresh slide in crude values in the near-term -- not to mention both operators' worrisome long-term earnings outlooks -- I reckon investors should steer well clear of the black gold specialists at the current time.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended BP and Royal Dutch Shell B. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.