Flexibility and finesse essential to enduring Saudi-Russia oil deal

Russian Energy Minister Alexander Novak. (Reuters)
Updated 07 June 2019

Flexibility and finesse essential to enduring Saudi-Russia oil deal

  • There had been melodramatic suggestions that the panel on global energy markets at Russia’s premier economic gathering would be some kind of high noon stand-off
  • One of the themes of the conference has been the growing closeness of the Saudi-Russia relationship, not just in oil but extending across industrial and financial sectors

ST. PETERSBURG: The message that came across loud and clear from the energy sector gathered in St. Petersburg on Friday was that the entente between Saudi Arabia and Russia on oil supply limits is here to stay, but that all parties to the deal will need to show finesse and flexibility in how it is operated.
There had been melodramatic suggestions that the panel on global energy markets at Russia’s premier economic gathering would be some kind of “high noon” stand-off over production limits, but no such outcome was likely or forthcoming.
The two main architects of the alliance — Saudi Energy Minister Khalid Al-Falih and his Russian counterpart Alexander Novak — have too much respect for each other, as was made clear at Friday’s meeting, for such an outcome.
More importantly, there is consensus between them that the arrangement has served both the global oil industry, and the economies of their two countries, well. Novak said the objectives of the agreement are being met. The alternative of letting the market go the way it did in 2015 is “unacceptable,” said Al-Falih.
In fact, the cuts regime may be more needed now than ever, both men agreed. “Fundamentals are no longer the biggest driver of oil prices,” the Russian said, while Al-Falih pointed out that Saudi Arabia and OPEC+ could only affect the supply side of the equation. “Demand is influenced by macro factors,” like connected worries about economic growth and global trade tensions, while “sentiment and expectation are also outside our control,” he said.
So in an uncertain world, the stability of an OPEC+ deal is essential. But the devil is in the detail, and this has to be pinned down at the coming full meeting of OPEC and non-OPEC oil producers, which both men were adamant would take place soon.
This is where the flexibility will come in. There is a consensus that the supply deal will continue — “rolled over” in the industry parlance — but both men agreed there was still work to be done to get to a definitive arrangement. “We will come to a decision, but it will not be cast in concrete. We can always adjust up or down as the need may be,” said Al-Falih, recognizing that the volatile global economic and geopolitical outlook might affect their calculations in the future.
One of the themes of the conference has been the growing closeness of the Saudi-Russia relationship, not just in oil but extending across industrial and financial sectors, right through to cultural ties. Neither side wants to risk that relationship for the sake of a few dollars a barrel.
The imminent rollover may also be prompted by a recognition that even tougher economic times might be ahead. Daniel Yergin, the oil expert who was also on the panel, was asked what would be needed to resolve China-US trade tensions at the upcoming G20 summit in Japan.
“A miracle,” he replied.


Palantir listing may shine light on secretive Big Data firm

Updated 21 September 2020

Palantir listing may shine light on secretive Big Data firm

  • Palantir’s filing suggests a valuation of some $10 billion, down from a private value as high as $25 billion, according to Renaissance Capital

WASHINGTON: Perhaps the most secretive firm to emerge from Silicon Valley, Palantir Technologies is set for a stock market debut this month that may shed light on the Big Data firm specializing in law enforcement and national security.

Palantir platform has been used in the controversial practice of “predictive policing” to help law enforcement, detect medical insurance fraud and fight the coronavirus pandemic.

While Palantir’s data practices and algorithms are secret, the company claims it follows a road map which is, if anything, more ethical than its tech sector rivals.

It moved its headquarters to Denver this year, partly in an effort to set itself apart from its Silicon Valley rivals.

“Our company was founded in Silicon Valley. But we seem to share fewer and fewer of the technology sector’s values and commitments,” Palantir says in its prospectus. “From the start, we have repeatedly turned down opportunities to sell, collect or mine data.”

Palantir is opting for a direct listing, expected on Sept. 29. This will not raise capital but will allow shares to be traded on the New York Stock Exchange.

Palantir’s filing suggests a valuation of some $10 billion, down from a private value as high as $25 billion, according to Renaissance Capital.

The company posted a loss of $580 million last year on revenue of $743 million. But it sees prospects improving as it offers solutions to what it calls “fractured health care systems, erosions of data privacy, strained criminal justice systems and outmoded ways of fighting wars,” its regulatory filing says.

Palantir’s biggest shareholder is Peter Thiel, an early Facebook investor and one of the rare tech executives who backed Donald Trump’s campaign in 2016.

“We are in a deadly race between politics and technology,” Thiel wrote in a 2009 essay for the libertarian Cato Institute.

Activists argue that Palantir’s technology — which scoops up financial records, social media posts, call records and internet records — enables unprecedented opportunities for mass surveillance with little oversight on privacy and fundamental rights.

Human rights activists have staged protests against Palantir after US agencies used its technology to hunt down illegal immigrants in the United States.

The immigration rights activist group Mijente claims Palantir technology is used in operations to track and arrest thousands of people “just for being undocumented.”

Palantir is a major player in “predictive policing,” a technology which critics say can amplify bias in law enforcement.

A 2017 research paper by University of Texas sociologist Sarah Brayne found the Palantir platform can connect seemingly unrelated bits of data for investigators, but can also lead to “a proliferation of data from police” collected without a warrant.

Palantir does not apologize for its work in national security and law enforcement.

Palantir points out that it created a privacy and civil liberties board in 2012, ahead of most tech rivals. It also rejects working with China as “inconsistent with our culture and mission.”