SPIEF DIARY: Back in the USSR — a surreal tour of the St. Petersburg forum

The Beatles in their pomp around the time that they recorded ‘Back in the USSR’. (Reuters)
Updated 07 June 2019

SPIEF DIARY: Back in the USSR — a surreal tour of the St. Petersburg forum

  • I found myself humming ‘Back in the USSR’ by the Beatles as I ambled through The Expoforum, my mind a jumble of Cyrillic letters
  • There was a media industry corner (not to be confused with the media center), where TASS, Gazeta, Sputnik news and RT nestled closely together as if for mutual support

ST. PETERSBURG: The Expoforum on the outskirts of St. Petersburg, where the city’s International Economic Forum is being held, is cavernous.
Walking the main thoroughfare from hall D1, where many of the big set pieces take place, to H, where the media center is located, was exhausting, but the journey could be profitable. I watched local Russian journalists, who have obviously “done” the forum before, time their trip so that they fell into the slipstream of one of the VIPs attending the event, shoving a microphone in their face and firing off a question or two. Sometimes, it worked.
That central artery links the exhibition halls and maze of meeting rooms that spin off the forum center, and where much of the real bilateral business is done. It can be confusing at first finding your way around this warren of rooms and corridors, but again — watch the Russians. They know all the short cuts.
(I never made it to halls A to C, by the way, because it would have required a bus or taxi trip).
The exhibition halls themselves are like a journey through the lands of the former Soviet Union, from Minsk in the west to Vladivostok in the east. I found myself humming “Back in the USSR” by the Beatles as I ambled through, my mind a jumble of Cyrillic letters.
There were some familiar places. Moscow and St. Petersburg had stands like small towns, with a real Moscow metro train on show at the capital’s stand.
Others — like Sverdlovsk, Kaluga and Krasnodar — I could take a fair stab at on a map, though the Siberian Federal District threw up some questions, and the Udmurt Republic, Dobrograd, and Penza could just as easily have been on the moon for all my knowledge of them.
Some of them may actually have been corporate names, rather than places. For example, Cherkizovo sounded like a village from a Tolstoy novel, but turned out to be Russia’s No. 1 meat producer.
The further you went through the halls, the more surreal it became. One stand had a lit-up map of shipping routes just south of the North Pole, almost like a bus schedule, though they cannot all be open yet, unless global warming has had an even more dramatic effect there than we thought.
Hidden behind a stand devoted to the “International Year of the Periodic Table” was one labeled “Invest in the Leningrad Region.” I thought that didn’t exist any more?
The halls were separated by courtyards, where exhibitors crammed their wares. Mercedes, for example, had a big indoor stand, and an even bigger one outside, with lots of glittering cars to play with.
It was located some way from the stand of a Middle East airline (which will remain nameless), sitting all alone, totally isolated from its neighbors.
There was a media industry corner (not to be confused with the media center), where TASS, Gazeta, Sputnik news and RT nestled closely together as if for mutual support.
“Question more” was the RT slogan, but the nice woman on duty couldn’t answer when I asked if there was a Pravda or Izvestia stand anywhere. Probably my accent.
Bloomberg, in contrast, was away from media colleagues in the main corridor, next door to the Russian Direct Investment Fund — obviously a symbiotic relationship.
Most gobsmacking of all was the Kalashnikov stand, where you could pose for photographs with some of the legendary firm’s deadly, though unloaded, products.
After all that mind scrambling, it was a relief to get back to the familiarity of the two Saudi stands — Aramco and SABIC. No flashy gimmicks, no air hostesses, just familiar corporate branding and sound messaging: “Where energy is opportunity” and “Chemistry that matters.” Warm, comforting words in St. Petersburg.

  • Frank Kane is an award-winning business journalist based in Dubai. Twitter: @frankkanedubai

WEEKLY ENERGY RECAP: Keeping things in balance

Updated 08 December 2019

WEEKLY ENERGY RECAP: Keeping things in balance

  • The over-compliance will result in cuts of 1.7 million bpd

Brent crude rose above $64 per barrel after OPEC+ producers unanimously agreed to deepen output cuts by 503,000 barrels per day (bpd) to a total 1.7 million bpd till the end of the first quarter of 2020.

The breakdown is that OPEC producers are due to cut 372,000 bpd and non-OPEC producers to cut 131,000 bpd.

Current market dynamics led to this decision as oil price-positive news outweighed more bearish developments in the US-China trade narrative that has weighed on oil prices throughout the year, with US crude exports rising to a record 3.4 million bpd in October versus 3.1 million bpd in September.

OPEC November crude oil output levels at 29.8 million bpd show that producers were already overcomplying with its current 1.2 million bpd output cuts deal by around 400,000 bpd. 

The over-compliance will result in cuts of 1.7 million bpd, especially when Saudi Arabia continues to voluntarily cut more than its share.

This makes the agreed 1.7 million bpd output cuts pragmatic since it won’t taken any barrels out of the market.

It isn’t a matter of OPEC making room in the market for other additional supplies from non-OPEC sources, as OPEC barrels can’t be easily replaced.

Instead, this is about avoiding any oversupply that might damage the global supply-demand balance.

Saudi energy minister Prince Abdulaziz bin Salman has effectively kept his promise and managed to smoothly forge a consensus among OPEC and non-OPEC producers.

He has also successfully managed the 24-country coalition of OPEC+ including Russia in reaching an agreement.

Despite suggestions otherwise in recent coverage of the Vienna meeting, the deeper cuts announced on Friday have nothing to do with the Aramco IPO. Let’s remember this meeting was scheduled six months ago and the IPO has been in the works for much longer.

The Aramco share sale did not target a specific oil price. If that was a motivating factor it could easily have chosen another time.