Responses to the decline in world oil prices have been mystifying — flummoxing, in fact. The secretary general of OPEC (the Organization of Petroleum Exporting Countries), Abdullah Al-Badri, said last week that speculation was to blame for the decline by 15% since the last increase in production. He ceremoniously denied that there was any attempt by the cartel to discourage production from shale or oil sands, or to put political pressure on Iran or Russia. In general, the world’s media have bought into the theory that discouragement of production from new sources that would reduce oil imports, especially by the United States, is the real reason for increased production and reduced price.
But Al-Badri has a limited mandate to give the agreed official line of OPEC and has no authority to speak for the motives of the individual member states, and even less standing to mind-read the authorities in those countries and speak for them. OPEC is a slippery cartel at the best of times, many of whose members are virtually, if not actually, at war with each other; the member states don’t necessarily speak truthfully among themselves and anything uttered on behalf of the whole group should be treated with caution. Some member states, including Iraq, Libya and Nigeria, do not really speak for the oil-exporting regions in the country, and there are many other oil-producing countries that either do not export, or even if they do, are not in OPEC, including Canada, Australia, Norway, the United Kingdom and the United States.
