VIENNA // Before its meetings Opec gives reporters a guide with a page devoted to each of the men who decide the fate of nearly half of the world's oil supply. Lines upon lines of text detail the oil ministers' career histories, university degrees and how many children they have.
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Last Updated: June 12, 2011
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But last week some negotiators seemed to arrive in Austria with no past at all. Opec staff had only enough notice from Iran and Libya to paste in mugshots and names, leaving the rest of the page starkly blank - a testament to the uncertainty in those member states and the Opec alliance itself.
Last Wednesday the organisation's leaders failed to reach a consensus on crude output targets for the first time in more than a decade. Officials emerging from the fractious six-hour negotiations did not appear even to agree on the date of their next meeting. The powerful group that has held sway over the world economy for half a century had, as one former Opec official put it, "abdicated" its role.
"The whole [group] now looks fragmented, and it affects its global credibility if it looks like there is a rift and member states are doing their own thing," said Caroline Bain, a senior commodities specialist at the Economist Intelligence Unit in London. "At the moment, it seems difficult to see how to restore the credibility of Opec."
Saudi Arabia is now likely to go it alone in an output increase in defiance of its Opec quota. On Friday, Al Hayat newspaper reported that the kingdom planned to move production from today's levels of about 9 million barrels a day (bpd) to 10 million bpd next month. The fracture between Saudi Arabia and the Iran-led Opec members is being widened by pressure from the US and Europe, Ms Bain said.
"They have the West battering on their door saying increase output," she said. "They're being forced to raise output unilaterally."
Bringing back the organisation's clout is important not only to Opec, as Brent crude, the European benchmark, flirts with US$120 a barrel, a level that many agree can hinder the global economic recovery. Opec's in-house economists warned on Friday that sustained high prices could wipe away 200,000 bpd of demand from the market.
Meanwhile the International Energy Agency, the organisation based in Paris that represents the interests of 28 oil-importing industrialised nations, has again threatened "to help ensure that markets are well supplied", implying it could reach into its own emergency stockpile.
"The high price is very bad for the world economy, and until now the world economy is not strong enough," said Sheikh Ahmed Zaki Yamani, who served as Saudi oil minister for 25 years. "The problem with some Opec members is they want a high price of oil and high production, and this cannot happen all the time."
The tensions preventing consensus are part political, part economic. Production increases advocated by Saudi Arabia are opposed by countries that are already pumping at maximum capacity. Meanwhile, a protracted civil war in Libya, where Qatar and the UAE are aiding the forces rebelling against the regime of Muammar Qaddafi, and tensions between the Opec powerhouses Saudi Arabia and Iran have pitted some nations against each other.
Analysts predict the Opec nations will not act as harmoniously as in the past decade but the organisation will remain intact.
"People aren't used to it, because we've had a very long period of stability in Opec when people were business-minded. When it came to the oil industry, pretty much everyone pulled up behind Saudi Arabia," said Samuel Ciszuk, a regional analyst at IHS in London, marking 1999 as the beginning of that period.
"Before that everybody was just overproducing and cheating and oil prices were very low. The Saudi oil minister, [Ali] al Naimi, was very instrumental in pulling everyone together and saying enough cheating, let's stick to our quotas and rein in supply and lift prices.
"It's never been an organisation that drives member countries, it's been the member countries that drive the organisation."
Power struggles inside Opec will have less of an impact on the organisation's lifespan than advances in renewable energy technology, said Sheikh Yamani, who now heads the Centre for Global Energy Studies, a think tank in London.
"As long as the need for Opec's oil is there, Opec will continue," he said. "When you have alternative sources of energy, this will be the end of Opec. But this is way in the future, not now. What makes it happen sooner is the high price of oil."
ayee@thenational.ae
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Mohammed bin Zayed Majlis
Ms Yang's top tips for parents new to the UAE
- Join parent networks
- Look beyond school fees
- Keep an open mind
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
What is blockchain?
Blockchain is a form of distributed ledger technology, a digital system in which data is recorded across multiple places at the same time. Unlike traditional databases, DLTs have no central administrator or centralised data storage. They are transparent because the data is visible and, because they are automatically replicated and impossible to be tampered with, they are secure.
The main difference between blockchain and other forms of DLT is the way data is stored as ‘blocks’ – new transactions are added to the existing ‘chain’ of past transactions, hence the name ‘blockchain’. It is impossible to delete or modify information on the chain due to the replication of blocks across various locations.
Blockchain is mostly associated with cryptocurrency Bitcoin. Due to the inability to tamper with transactions, advocates say this makes the currency more secure and safer than traditional systems. It is maintained by a network of people referred to as ‘miners’, who receive rewards for solving complex mathematical equations that enable transactions to go through.
However, one of the major problems that has come to light has been the presence of illicit material buried in the Bitcoin blockchain, linking it to the dark web.
Other blockchain platforms can offer things like smart contracts, which are automatically implemented when specific conditions from all interested parties are reached, cutting the time involved and the risk of mistakes. Another use could be storing medical records, as patients can be confident their information cannot be changed. The technology can also be used in supply chains, voting and has the potential to used for storing property records.
Best Academy: Ajax and Benfica
Best Agent: Jorge Mendes
Best Club : Liverpool
Best Coach: Jurgen Klopp (Liverpool)
Best Goalkeeper: Alisson Becker
Best Men’s Player: Cristiano Ronaldo
Best Partnership of the Year Award by SportBusiness: Manchester City and SAP
Best Referee: Stephanie Frappart
Best Revelation Player: Joao Felix (Atletico Madrid and Portugal)
Best Sporting Director: Andrea Berta (Atletico Madrid)
Best Women's Player: Lucy Bronze
Best Young Arab Player: Achraf Hakimi
Kooora – Best Arab Club: Al Hilal (Saudi Arabia)
Kooora – Best Arab Player: Abderrazak Hamdallah (Al-Nassr FC, Saudi Arabia)
Player Career Award: Miralem Pjanic and Ryan Giggs
The bio
Favourite book: The Alchemist by Paulo Coelho
Favourite travel destination: Maldives and south of France
Favourite pastime: Family and friends, meditation, discovering new cuisines
Favourite Movie: Joker (2019). I didn’t like it while I was watching it but then afterwards I loved it. I loved the psychology behind it.
Favourite Author: My father for sure
Favourite Artist: Damien Hurst
The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
IPL 2018 FINAL
Sunrisers Hyderabad 178-6 (20 ovs)
Chennai Super Kings 181-2 (18.3 ovs)
Chennai win by eight wickets
The Details
Kabir Singh
Produced by: Cinestaan Studios, T-Series
Directed by: Sandeep Reddy Vanga
Starring: Shahid Kapoor, Kiara Advani, Suresh Oberoi, Soham Majumdar, Arjun Pahwa
Rating: 2.5/5
The UAE squad for the Asian Indoor and Martial Arts Games
The jiu-jitsu men’s team: Faisal Al Ketbi, Zayed Al Kaabi, Yahia Al Hammadi, Taleb Al Kirbi, Obaid Al Nuaimi, Omar Al Fadhli, Zayed Al Mansoori, Saeed Al Mazroui, Ibrahim Al Hosani, Mohammed Al Qubaisi, Salem Al Suwaidi, Khalfan Belhol, Saood Al Hammadi.
Women’s team: Mouza Al Shamsi, Wadeema Al Yafei, Reem Al Hashmi, Mahra Al Hanaei, Bashayer Al Matrooshi, Hessa Thani, Salwa Al Ali.
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NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
