The politics of oil [Archives:2005/847/Viewpoint]

June 2 2005

The oil issue is more than just an industry or an economic subject. Oil more than anything else is politics. Perhaps because of the vital importance of it to sustaining human life and as a source of power. Nevertheless, it seems that the state in the last minutes discovered that it should clean some of the smelly practices and policies, a fact that in turn would fire back and increase the liability of the oil companies working in this sector in Yemen.

Considering this, and keeping in mind that the parliament is preparing for the coming elections in April 2006, something urgently had to be done. It started with the increasing pressure of the donor organizations such as the World Bank on the government to fulfill its promised reforms. Today, the current government is playing in the compensation time as the actual time of the match is over. President Ali Abdullah Saleh two years ago had declared that the current government had two years to prove its ability to create reform and to improve the economy. Since April 2005 the current government had been anticipating the evaluation of their performance. And it seems that some faces will have to be sacrificed, clearing the way for some new changes.

The current government, faced by both the demands from the parliament and the World Bank is really in trouble and a way out needs to be cleared soon enough, at least so that the president holds to his words regarding reform.

This in brief is what had been going on to some extent, in the oil sector. And while the GPC Member of Parliament Oil Committee Mr. Sakhr Al-Wajih deemed the government's commitment to revoke extension of Hunt block 18 PSA a significant victory for the oil management reform, mentioning that the government had extended an LNG contract with Total for three times without referring back to the parliament. Premier Bajamal meets Total and Hunt Oil authorities to discuss relations and the companies' performance in Yemen.

So what's the story with oil these days and is it really the rise of the conscious among MPs? Or the is there something else to it? More to say about this in the next issue.