Opecology

During the Cold War, western intelligence agencies became obsessed with the minutiae of the Soviet Union’s upper echelons. Reliable information was hard to come by because the Kremlin hid its secrets behind walls behind walls, and because the power structure was so impregnable the devil, so it was thought, had to be in the details.

Who was standing next to whom at a Red Square parade; were official titles spelt with upper or lower case letters in Pravda; who was dining together and who was not. These and myriad other gobbets were compiled, collated, combed over and an overall picture confected of the balance of power and the stability of the edifice — this branch of cod science came to be known as Kremlinology.

These days, any out-of-work Kremlinologists with a nostalgic yen to brush up on old skills would be welcome in Vienna where Opec — another organisation that gives little away — meets this week amid unprecedented strains. They could find a career in their twilight years, as Opecologists.

The arrival in Vienna of Saudi Arabia’s oil minister Ali Naimi was a case in point. Never one to give too much away, Naimi offered up a snippet that would have the Opecologists working overtime.

“We will listen, and then decide.”

A mere six words, but enough to instil doubt in the fainthearted about the outcome of this week’s meeting, which had appeared pre-ordained.

That Saudi Arabia, the key mover in Opec’s output strategy, “will listen” to other members — many of whom are concerned about their future viability in a low oil-price environment — might suggest there is wriggle-room away from the hard line of market share over price support.

That Opec will only “then decide” might suggest that this meeting isn’t as cut and dried as many think. Is there a pre-Christmas gift in store for oil bulls, US frackers and sovereign bean counters?

It was classic Naimi, a man you would not want to face across a poker table. He doesn’t suffer fools, and most journalists rank lower than fools in his view. For Naimi, the real business goes on behind closed doors and this week that means convincing some of Opec’s internal dissenters of the righteousness of the chosen path.

Those members feeling the pinch will point to record high exports coming through the CPC pipeline to Russia’s Black Sea ports and North Sea BFOE exports at four-year highs, and wonder just whose market share this strategy is protecting.

Iran will look at Iraq’s record high export programme and wonder how Opec will accommodate its imminent return to the market without abandoning even the fiction of its 30mn b/d output target.

Whatever happens behind closed doors, Opecologists will pore over the post-meeting official statement — a Pravda-like communique — and gnomic press conference for buried clues as to what’s next.

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