"Hogwash" said the minister, jovially. "Hogwash," chanted the journalists as they marched into the hotel lobby following a brisk morning walk in beautiful Vienna. Bemused onlookers must have thought we were extras from a new Harry Potter movie. Hogwash.
The minister was jokingly responding to our request for a comment on a report by a prominent firm of oil analysts speculating that OPEC's 12 ministers were actually going to discuss a production increase of 500,000 to 1 million b/d in Vienna on September September 11. Hogwash?
"Have you seen the film, 'The Twelve Angry Men?" the minister asked the posse of journalists trailing him on his walk? The old timers of course knew instantly that the minister was referring to the famous film starring Henry Fonda and in a way was giving us a hint of what was to come. What he was trying to tell us was that noone could predict the outcome of the meeting until the ministers had met and thrashed out an agreement.
Although most ministers had arrived in the Austrian capital saying they saw no need for the group to change its production targets even though oil prices were sizzling, the reference to the courtroom drama was spot on. One man, provided he had a convincing argument, could turn the others around. Except not all the joggers got it. "Does this mean that the other ministers are angry with you?" asked one young journalist. Some of us sniggered as the subtle message sank in.
As we turned the corner, we spotted the ferris wheel in Vienna's Prater Park, the one immortalized in another movie classic, The Third Man, the thriller starring Orson Welles. It felt as if were were actually on that revolving wheel, being taken around in a big circle as minister after minister repeated the same mantra for weeks leading to the meeting. "Markets are well supplied with crude oil." "There is no need to raise production." "High oil prices are due to refinery shortages and geopolitics," they said, as if reading from the same script.
Most of us long-term OPEC watchers could have written the script, up to a point. But we couldn't have written the ending. We were riding that wheel and we didn't realize that it was turning the other way. After all, we had asked and he had answered. Hogwash.
Next day, the assembled journalists, carrying cameras, notebooks and tape-recorders charged up the stairs at OPEC's Vienna headquarters on the Tuesday morning to the conference room where the 12 men sat around a horseshoe table configuration. It is not a pretty sight as the men and women representing the world's financial news agencies, print and broadcast media squeeze into the tight space to try to get a few nuggets of information from individual ministers. That is the day I wear my very pointy stiletto heels for protection to prevent any damage to my extremities as the scrums build around the ministers.
Opening remarks over, the media is ushered out of the room, having sipped coffee and nibbled on biscuits the secretariat makes available at each of these meetings like some kind of ritual. Down in the press room, we mill about, chat to analysts and catch up with friends as we wait and wait for the meeting to end. This one overran the expected time and we were convinced the 12 men were cooking up a surprise. Obviously the foreman had not yet convinced the 11 others. Some of us picked up some OPEC literature to help ease the tedium. One brochure containing the biographical data on all the ministers contained a nugget. The brief on Iraq's oil minister, Hussein Shahristani, had the most interesting entry under the heading of political activity. "Political prisoner, 1979-91" it read. The soft-spoken Shahristani did spend time in one of Saddam Hussein's notorious prisons.
On the Wednesday night, when the meeting was over and the 12 OPEC ministers had agreed to raise production by 500,000 b/d, we celebrated the end of yet another OPEC meeting. The analysts, who had provoked the fuss in the first place, were reading the final communique confirming the increase with a satisfied grin. Hogwash? Hmmmmmmmmmmmmmm.
I believe the American Public is being given a "SNOW JOB" on the cost of refined gasoline. Clearly the OPEC countries are seeking additional cash for their many infrastructure projects and to increase the revenue of the Shieks and politicians in non-Middle-Eastern countries.
The American Oil companies and Refiners are raking in the "CASH" by the Aircraft carrrier class mode and stiffing to the People of America.
I know and many in the industry know that Light Crude should only be $15.00 a barrel, and that Heavy Crude should only be $12.00 to $13.00 a barrel, but with the War going on and the Hedge funds needing to make larger profits due to the mortgage market collapse, Oil will continue to rise.
I find it laughable that OIL markets pricing rises so much on "EMOTIONAL ISSUES". I believe, If Crude falls to $25.00 a barrel, which I believe is realistic and if nations continue to grow the non-oil, automobile alternative fuels, the OPEC group will splinter, weaken and the prices will fall below $20.00 a barrel by Mid 2008.
If prices continue to climb, I for one and many I speak to nationally have cut back 30% of our driving time. I moved my business into my home recently to save $100.00 per week in gas. Just think what would happen if thousands of small business people did the same., I have begun to start a movement and I am reaching out to small business everywhere to establish an permanent home office until gas is uner $1.00 a gallon again.