Friday, April 22, 2016

Kuwaiti Oil Workers End Three Day Strike

Striking workers at union HQ
From Homoud Halabi in Paris.

The Kuwait Oil Workers Union called off a “total strike” and decided to return to work on Wednesday hours after a fresh appeal by the acting oil minister. The strike had given some support to oil prices.  “In respect for the Emir and in loyalty to him... we have decided to cancel the total strike,” an official statement by the union said,

The statement said workers would go back to work at 0400 GMT.
“We trust the emir... for the protection of the rights of oil workers,” said the union statement, posted on its official Twitter account. The surprising decision came only hours after the union leaders told a press conference that they would continue their strike, having rejected all appeals.
The union leaders had insisted that they would end the strike only after all their demands were met in full including the scrapping of plans to cut their wages and benefits.

Giving a clear indication of the potential power of the oil workers with regards to the Kuwaiti economy and OPEC, the strike, which began last Sunday, slashed OPEC members’ crude and natural gas production by more than half.

Kuwait’s crude production dropped from 3.0 million barrels per day to just 1.5 million bpd and refining output dived to 520,000 bpd from 930,000 bpd. Acting oil minister Anas al-Saleh called on workers in a television interview Tuesday night to return to work and start negotiations with authorities.

While Western media had concentrated on the short-term impact of increasing oil process given the immediate impact on supply there was more to this strike according to reports. The unilateral imposition of change, a response to previous oil price declines, and the decision to roll the determination of wages and conditions in the oil sector to the general public sector was a factor.

The oil workers have basically argued that this was and is what funds the country and there have been massive surpluses in the Kuwait budget for years that funded all operations, but the oil sector - highly unionized across all parts of the operations - had bargained separately - the government wants to change that and the oil workers resisted as it would have a long term deleterious impact on them and as they were bargaining leaders, could have an adverse impact more generally.

Reads: "The strike will not compromise"
The other issue is that there has been an attempt to weaken trade unions and increase government and judicial intervention and control over union affairs; this is also being resisted. I have not seen cases on this but it is an additional under-current of concern for the unions. But between 13 - 14,000 workers came out so the protest is significant.

Throughout the Middle East the oil workers have had a major influence and have traditionally been organized. Along with Kuwait, in Iran and Iraq under Hussein oil workers were unionized.  Despite what Westerners might think is an overly trusting view of Kuwait’s ruling elite, the significance of this strike is considerable. Although it received very little, if any coverage in the mainstream media in the west, it was watched closely and reported on by the financial papers including in India.

It is not hard to see why national divisions and religious sectarianism has a plus side for the rulers of oil producing states as well as Western powers. Cooperation by workers and trade unions across borders would increase the potential for unions to shut down oil production, or slow it significantly that would have a huge impact on the world economy as well as a serious threat to profits.

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