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The Decision Makers In Algeria's Energy Sector.

The petroleum sector in Algeria remains insulated from the country's civil strife, which does not seem likely to end in the near future, though the Islamist militants of the Sunni/Neo-Salafi order are a tiny minority. The top decision makers for this sector are well protected, together with a growing number of international oil companies (IOCs) and their personnel operating in the country.

Algeria has been caught in a vicious cycle of violence since early 1992. This is the result of an experiment in democracy aborted by the military regime to prevent Islamist militants from taking power through the ballot. The military's move set off a war which injected a sense of urgency among Algerian decision makers to speed up liberalisation of the petroleum sector and reform the economy. But a cycle of high oil prices from mid-1999 to mid-2008 - though interrupted by the 9/11 shock and a brief US recession which ended shortly before strikes caused Venezuelan oil production and exports to stop from late 2002 to February 2003 - gave rise to resource nationalism in OPEC and non-OPEC petroleum exporting states and this caused a reversal of key aspects of Algeria's liberalisation process.

In socio-political terms, Algeria has two time zones: the state functions in the Western time zone and is secular, while the radical Islamist opposition has a Muslim time zone which projects a different reality. The secular opposition is in the Western time zone.

There is a dividing line within the decision making system, which cuts through visible and invisible layers of authority. On the surface are pragmatic decision makers who favour negotiation with moderates among the militant Islamist groups. Below the surface are hardline generals who advocate "eradication" of all Islamist militancy. The balance of power within the invisible layer is heavily weighted in favour of eradication, while the balance in the visible layer favours more practical approaches to all problems.

Likewise a dividing line cuts through the Islamist opposition: the extremist Neo-Salafi group remains set on a fight to the finish, while the less radical Front Islamique du Salut (FIS) and the more moderate Islamists reject the Neo-Salafi tactics. The Neo-Salafis are affiliated with Osama bin Laden's trans-national group al-Qaeda, with the latter having spread to North Africa (the Arab Maghreb) from Mauritania to Tunisia including Algeria.

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Publication:APS Review Downstream Trends
Date:Mar 2, 2009
Words:383
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