What the Saudis are saying
One way to measure the latest meeting of OPEC is by the penny extra a gallon it may cost Western fuel consumers. A more significant way is to calculate, what the outcome says about power and policy in the Middle East -- and what the response of countries dependent on imports of Arab oil should be.
At the core of this calculation are Saudi Arabia, the biggest oil exporter, and the United States, a prime oil customer and also the chief Western player in the Middle EAst arena. For them the inconclusive meeting in Vienna ned not prove to have been the huge "failure" designated by some. Rather, it can be seen as leaving a brief grace period whose aftermath could be better or worse according to how this time is used.
Later meetings of the Organization of Petroleum Exporting Countries this year are scheduled to take up such unresolved questions as a long-term unified pricing policy and a program of aid for third-worl oil importing countries. Hard-line Arab state stood in the way of pricing agreement. According to some speculation, the OPEC majority may go ahead without them in the future.
What was agreed to is a temporary freeze on OPEC prices ranging up to $37 a barrerl, or roughly a hundred times the cost of producing a barrel of Mideast oil. As part of the deal Saudi Arabia agreed to raise its price of $28 to $30 a barrel, this lifting the OPEC average slightly. But the Saudis refused to ease the current world oversupply of oil, with its downward pressure on prices, by cutting back its produciton of 9.5 million barrels a day.
On the horizon of this relatively happy situation for oil importers is the likelihood of some sort of future escalating pricing plan and the possibility of a Saudi cutback. To do its part in encouraging a moderate result the United States needs to pursue policies that help Saudi Arabia to encourage such a result
As it is, the Saudis seemed to be using the Vienna meeting to let the US know that they still have clout in the Arab world and are not prepared to hold back the pricing tide indefinitely. And they seemed to be letting OPEC members know, too, that they are not prepared to roll over under hard-line demands.
To put it another way, the Saudis are trying to keep their position as the state for the WEst to turn to because they have influence. At the same time, they need to be able to show some influence with the West in order to retain their influence among the Arabs.
Here is where the main Western actor, the US, needs to display its responsiveness -- by prudent energy policy at home, by unabated efforts for just settlement of the Palestinian question in the Middle East. For all of President Carter's concern for the Jewish vote in an election yer -- and, more important, because of his concern for the security of Israel itself -- he could help keep Saudi Arabia in a position to pursue a course of moderation by reasserting US concern for the Palestinians. too.