A secret war is going on in The Middle East and although no one is dying, billions of dollars are at stake as governments plot and manipulate to come out on top of the battle to dominate oil markets.
The latest battle sees political and economic opponents Saudi Arabia and Iran squaring up to each other again in a row over capping oil production in a bid to make the price rise.
This struggle has waged behind closed doors for months.
Earlier in the year, Iran refused to sit down with OPEC ministers in Doha, Qatar, to broker a cap on oil production.
The reason, said Tehran, was sanctions against Iran’s oil trade had only just been lifted and the industry needed to get back on its feet.
Locked in battle
Fast forward a couple of months to Saudi Arabia and Iran still locked in a dispute over production quotas.
Saudi Arabia is scared of losing market share to rivals, while Iran is hungry for foreign currency and needs to sell as much oil as possible.
Another OPEC meeting is due shortly in Algiers and this time a production cap is on the cards.
Why? Because the major players have nothing to lose because they are already pumping oil out of the ground at or close to capacity.
Saudi Arabia and Iran have added a million barrels a day to their output.
Russia also failed to attend the Doha debacle but has also nudged up production to near capacity.
Market share
“All the conditions are set for an agreement,” says OPEC. “Russia, Iraq, Iran and Saudi Arabia are reaching their top production level. They have gained all the market share they could gain.”
Meanwhile, ministers are jockeying for concessions.
Russia sees no need for a production freeze while prices hover around $50 a barrel. Nigeria is against a freeze as production has sunk to a 27-year low following continual civil unrest disrupting supplies.
In Venezuela, swapping oil for dollars is keeping the inflation-ravaged economy afloat even though output is at the lowest since 2003.
Libya also needs oil cash to pull out of a power vacuum following Gaddafi’s overthrow.
The politics of oil are the politics of greed. Saudi Arabia is flooding the market with oil that pushes down the price at the pumps in an effort to counteract the growth of US and Canadian shale oil. Shale oil reduces the North American reliance on Middle East oil.