Diplomacy is a painstaking process, people know and understand. It takes time to blossom and bear fruits. And energy diplomacy is no different too. In fact, some claim it to be even more difficult.
There seems logic behind this argument as evinced at the press conference after the 2nd Asian Energy Ministers in Riyadh last Wednesday afternoon.
At the 1st Asian ministerial talks held in New Delhi, some two years back - January 2005 to be precise - consensus was reported on some major issues. Some discussions were reported then among the ministers on developing an Asian oil market and Asian benchmark crude. Ministers then reportedly had agreed to press ahead and pursue with these two ideas. And then the then Iranian delegation had also floated the idea of an Asian Energy Development Bank.
The ideas were greeted with enthusiasm, at least within the regional energy fraternity.
A mechanism to follow up on the agreements and discussions of these ministerial roundtables is required to be in place, one feels. Perhaps the Riyadh-based IEF Secretariat, the coordinator, could assume a lead role in this direction.
After attending the deliberations in Riyadh, one thing however, was getting apparent - a new Asian Energy identity is definitely on the horizon. And there are ample reasons for that. Signifying the importance of Asia in the current energy equation and in the overall global context, Saudi Minister of Petroleum and Mineral Resources Ali Al-Naimi highlighted that about two- thirds of oil exports from West Asia (currently) go to East Asia and about 70 percent of East Asian crude imports come from West Asia.
With some 17 countries from the region taking part in the meeting, Ambassador Arne Walther of the International Energy Forum was forthright when he pointed out during his inaugural comments: “The number of countries around the table today is not great, but your clout as energy producers and consumers is.” He said further “West Asian supply growth will be the key to meeting increasing East and South Asian demand.”
While energy diplomacy may be at peak around the roundtable, some fire works also could not be missed altogether. That’s part of diplomacy too, some say.
Omani Minister for Oil and Gas Muhammad Al-Rumhy expressed dismay and disappointment when “friendly nations openly state that they would stop importing from Middle East if they find alternative sources. I know of one friendly country that gives incentives to companies that import non-Middle Eastern oil.”
Underlining support to the ongoing efforts in research on alternative to hydrocarbon, he went on to say: “How can we be expected to invest heavily (as is required) in capacity building and sustainable supply knowing very well that the market was looking for alternatives? Such policies do not help the cause of security of demand.”
He also questioned the issue of putting reserves in consumer countries. “We are constantly reading efforts and discussion on creating strategic reserves in consuming nations. This is a noble idea if only the true intention is strategic in nature rather than creating a tool to influence the market.”
The producers need to look at their interests too and this is what dialogue and diplomacy is all about - generating a win-win solution. This is the challenge before the energy diplomats and it won’t at all be easy to find a solution to this complex puzzle.
The credit for the very idea of an Asian energy identity and dialogue between Asian producers and major consumers was floated and pursued by the then Indian petroleum minister Mani Shankar Aiyer. And he was rightly remembered during the meeting too. Naimi credited him with the initiative in his inaugural address and so did Ambassador Walther.
