Author: Kent Moors, Ph.D.
Well, an understanding of sorts has been reached about the “heavier” Spy Tale entries that have occasioned a protracted disagreement with “mother” over the past several months. With only the usual restrictions on discussing matters still classified, I apparently have carte blanche to write.
These upcoming tales comprise my most difficult experiences, will upon occasion be painful to read, and will put some folks in a less than flattering light. They will also introduce some of the more onerous of my own mistakes, the ones that tend to stay with you long after they occurred.
So, we will begin next week with sketching out the longer-term assignment while I was living in Moscow during the mid-1980s and the failures that resulted. By the time we are finished with these narrations addressing events unfolding over several decades, I intend to call both myself and others to task for what we did and did not do.
But this week’s entry took place more recently. My active days in the field as a counterintelligence (CI) officer had drawn to a close by that time, as had my academic career. The intel position I found myself in involved occasional support for operations, serving as an advisor to ongoing projects, and using my private sector activities as a conduit for matters of Agency interest.
This last category meant that there were still times in which my global travels, professional presentations, and consulting contracts would put me in places where “parallel considerations” could apply.
As they did in late November of 2018, resulting in the following rather extended background.
I was then in Singapore to provide the keynote address before OSEA. Each year, this is the largest Asian crude oil and natural gas conference, bringing together several thousand energy practitioners and experts from around the world.
The conference was being held at the iconic Marina Bay Sands Convention Center, perhaps the most distinctive hotel in the world. If there has been one building that dramatically changed an entire city’s landscape, this is it.
My base of operations for more than a week was a club suite in the upper reaches of the center tower (just below the world’s largest roof top garden and infinity pool connecting the hotel’s three towers):
The suite would serve as both residence and a location for some very closed meetings.
The official OSEA program covers three days, although I was there for eight. I acted as conference chairman for the first day with my featured presentation on the second. Interspersed before, during, and after are a series of private meetings with some very heavy hitters.
OSEA requested that my presentation would be on the impact of US liquefied natural gas (LNG) exports to Asia and the changes these would bring to the energy mix.
Of course, whenever I have such engagements, they are usually also used for meetings among members of my private networks. That was also the case on this occasion. One such “sidebar” involved contacts from Saudi Arabia, the United Arab Emirates, and Kuwait. It dealt with the rapidly changing focus of global oil demand (to Asia) and the investment opportunities emerging in places like Singapore.
Singapore has long recognized that the costs of its energy are essentially determined by events elsewhere. As a result, this vibrant Asian location for commerce and business has become quite sensitive to trends in stock market trading centers like New York, London, Tokyo, and Shanghai.
However, by the time we gathered in November of 2018, a divergence was appearing. It was important because it indicated the end of a cycle. The assumptions now circulating through the assemblage of major investors, corporate execs, and industrial leaders gathering for the conference was that the combination of politics, short-running, and market dynamics was drawing to a close. It was a view strongly supported by the folks I was meeting with in private.
A very oversold oil sector was about to improve. As on-screen commentators in New York and London pointed out afterwards, it appeared I had called that reversal earlier in the week during my widely followed and extensive interview with CNBC Asia.
The bulk of the latest contemporary oil price decline had resulted from a political move by the then Trump administration to keep refined product prices low, guaranteeing others excess available crude. We were moving close to the next OPEC meeting (December 6, 2018) in Vienna with prospects for a coordinated cut in global production intensifying. That would ultimately bring in Russia and other producers not members of the organization into what was called OPEC+ and result in the cuts leading to a noticeable rise in international oil prices.
During my private meetings, a Saudi colleague noted – in an unusual expression of dry humor (not usually considered a strong Saudi trait) – “The decision we will forward next week [at Vienna] will put OPEC, and thereby Saudi, interests first … bluster from Mr. Trump notwithstanding.” The opinion was shared by other OPEC folks in our ad hoc “corner” conversation.
As was also the case, however, other geopolitical matters were impacting the situation.
While making our way to the studios of CNBC Asia for my interview, my taxi driver summarized the local climate this way. “We have three seasons in Singapore,” he said, “Hot, very hot, and very sticky hot.”
I smiled. Because, these days, he could well have been describing matters other than the weather. One loses the context unless in a physical location abutting a conflict zone. Here in a small city state recently judged as having the highest per capita income in the world, you could ignore what is happening elsewhere while fixating on a picture of skyscrapers and wealth. This was the view of Singapore from our Marina Bay Sands suite:
That is, of course, until you realize this setting is only a few miles up the straits from a prime global hot spot…the contest over the South China Sea (SCS).
I spent a good portion of a morning surveying that water way with folks I knew from the US Embassy here, as well as contacts in some of the largest shipping companies who frequently trade using these waters.
For this part of the world, the SCS crisis is not an abstract problem. It is very real. And for the subject matter of my major presentation to the conference set for a few days hence, it was also something else. It also just happens to be a main venue used by both crude oil and LNG shipments to a thirsty Asian market. This is a slide from my presentation dealing with the security problems inherent in LNG shipments arising from the SCS problem.
In addition to the national disagreements over who controls what parts of the offshore crude oil and natural gas development consignments, there are the very real concerns over whether transit on the water surface can remain open to all.
And that has a very real impact on pricing for LNG and crude oil shipments for the entire region.
This is an issue that provides what markets hate. The least desirable element is one of uncertainty. Not knowing what is likely to be the case in access to energy transit means that prices for both transfer and availability will be increasing. It is simply the cost of doing business in a fluid environment.
The situation was hardly made easier by the ongoing, and if the folks I am talking to in Singapore were correct, intensifying tariff war between the US and China.
I had to be reserved in what I said about anything attending this developing trade war. There were several representatives in attendance, both from Chinese national energy companies and from those penumbral organizations associated with both public and private entities beholden or answering to, or dependent upon, Beijing.
Singapore is, in a very real sense, right in their back yard.
There was a very real view I was hearing from several quarters that these two geopolitical dimensions (the SCS conflict and the US-Chinese trade tiff) were moving in tandem. One would have an effect on the other.
But these were hardly the only geopolitical issues shadowing our conversations. The major other existing situation involved the intentions of the Trump White House back home and whether there was any genuine consistency (and reliability) remaining in US foreign policy.
“Make America Great Again” does not wear well in most other parts of the globe. I had some genuine sympathy for the US State and Commerce Department reps walking the halls of the conference. They had an impossible sales job.
Following the machinations surrounding last minute (i.e., fourth quarter 2018) sanctions reprieves for major importers of Iranian oil, few people I was talking to in Singapore believed Washington could distinguish between US domestic politics back home and any consistent policy posture abroad.
I had criticized in print the eleventh-hour moves as directed only to domestic political objectives back in the States. But understand that I did not make such arguments in international venues such as the OSEA conference. I saw no advantage then (nor do I now) in bad mouthing the US abroad, even when the decision making had been this short sighted.
On the other hand, I also will not defend policy I think is inconsistent or flat out wrong. All of which makes it very difficult to navigate the thin road in between.
And then an additional wrinkle was added, attesting to the simple fact that geopolitics has a way of coloring a conversation wherever you happen to be. I received a reaction from events less than 24 hours old. The reaction was Russian, coming from conference attendees representing Gazprom (Russia’s national gas giant) and Gazprom Neft (the gas company’s crude oil production subsidiary).
My ongoing several-day side bar conversations were suddenly taken over by the naval conflict erupting between Russians and Ukrainians in the Black Sea. Normally, this would have been the subject of a curt statement. But not this time.
This has all the earmarks of a serious escalation in a simmering disagreement. It may not have anything to do directly with energy. Yet in the current environment that made little difference. Any developing crisis had the irritating habit of spilling into other areas.
Once again, uncertainty tainted energy discussions. Welcome to the new reality, I reminded myself. Regardless of which region is its initial focus, geopolitics permeates how energy operates. I some cases, that extends to how it is even perceived.
This was even extending to what emerged as the second part of my formal comments at OSEA –the financing of LNG and other energy exports to Asia. There are really no national boundaries there either.
But the combination of the SCS impasse and the changing nature of international finance for energy exports impacted on a parallel responsibility I had in Singapore.
And finally, we can segue into today’s Spy Tale.
Among my Chinese contacts, four were at OSEA and involved in portions of my private sidebar “suite” meetings. Two of these worked for CNOOC, the Chinese national oil company, and were backdoor bridges to policy makers in Beijing. They were also almost certainly under surveillance by Guoanbu (the Chinese Ministry of State Security) at the conference and may have been coopted by the state security apparatus.
If the opportunity presented itself, I was encouraged by Langley to initiate a conversation on an element of the SCS crisis. More to the point, the “higher powers” wanted to initiate a misinformation campaign on several fronts designed to generate a conflict of intentions among Chinese officials.
I have mentioned D&D (denial and deception) in previous Spy Tales installments. These were essential tools to run CI against opposition penetration while at the same time seeking to have them chase deliberately false intel.
The objective in Singapore was to further a false reading (previously generated elsewhere) of US intent in defending littoral SCS offshore oil and natural gas rights. These were to involve the claims made by Vietnam (officially, the Socialist Republic of Vietnam) to development rights surrounding several offshore islands in the Spratly chain also claimed by China (and, for that matter, by others).
Among the disagreements, however, the Chinese-Vietnamese problem had a further dimension. Chinese naval vessels had shot at research vessels in what Hanoi had claimed was their national waters. A few days before I left for Singapore a contact sent me the photo below. It shows a Chinese sub harassing Vietnamese fishermen in waters off the Spratly Islands.
The situation was a graphic demonstration of how matters change in geopolitics. Some 47 years ago, I was in Vietnam conducting CI during a war against the communist government we were now supporting in the SCS impasse (see “A Giving of Accounts … from Massachusetts to Vietnam,” Classified Intelligence Brief, #61, February 17, 2021).
Basic to this disinformation campaign was the intent to persuade Guoanbu that the US was moving to set up artificial offshore bases to defend Vietnamese clams against Chinese encroachment.
This was a deliberate provocation, the goal of which was to assess Beijing’s response to a perceived American escalation. It also mirrored what the Chinese themselves were doing. Ten months after Singapore I would provide a briefing in London during which the construction of artificial Chinese military bases in the SCS was discussed.
Here are two examples from that briefing, each an artificial operational site:
Interestingly, the US has just announced (August 23, 2021) that it would be constructing an artificial base in the Pacific Marshall Islands chain. But back in 2018, any indication that an American fixed base would go up in the SCS was a major escalation of the crisis.
The intent of the deception was to trace how Beijing would respond, the intel procedures Guoanbu would employ, and (if we were lucky) identify assets the Chinese had within Vietnam’s policy apparatus.
All of this would be handled by somebody else. My sole job was to serve as a high-profile expert adding credence to the rumor, both in my keynote address and in sidebar meetings that included Chinese contacts.
Comments were inserted into my speech and I made certain that a question on the matter came from the floor during the Q&A afterwards. On the next morning, I provided some additional particulars during a private session in our suite at the hotel. One of my Chinee contacts immediately left the meeting.
Two elements were paramount here: contracted personnel (both for construction/operational management) and coordination with offshore drilling programs (while both crude oil and natural gas were possible, all indications were that this area of Vietnamese interest was primarily gas).
The enticement that my misdirection could add came from the private sector mobilization that would have to accompany any official decision to build an offshore base and expand Vietnamese E&P (exploration and development).
My contribution would be to serve as a conduit for manufactured information on the energy side. A coordinated move had already added some additional American drilling personnel at the headquarters of the state dominant Vietnam Oil and Gas Group (PVN). At OSEA, I provided additional details on further specialist deployments (all fictional) to be sent in the next month.
The comments were magnified when they were included in news coverage of my address.
There was never any question that Guoanbu would soon learn the rumor was not true. These guys were highly trained professionals. But the exercise was primarily designed to gain some insight into how the Chinese operated. Much of that was accomplished elsewhere in the op. Even after concluding the misinformation was just that, they would have to do their version of an after-action report. That would still provide some valuable intel.
I sort of figured my involvement would be a short-run deception. And indications of that emerged before I even left Singapore. While waiting in the business lounge at Changi Airport for my plane out, a CNOOC contact who had attended both my speech and my private sessions approached. He smiled and simply said: “Nice try.”
Dr. Kent Moors
This is an installment of Classified Intelligence Brief, your guide to what’s really happening behind the headlines… and how to profit from it. Dr. Kent Moors served the United States for 30 years as one of the most highly decorated intelligence operatives alive today (including THREE Presidential commendations).
After moving through the inner circles of royalty, oligarchs, billionaires, and the uber-rich, he discovered some of the most important secrets regarding finance, geo-politics, and business. As a result, he built one of the most impressive rolodexes in the world. His insights and network of contacts took him from a Vietnam veteran to becoming one of the globe’s most sought after consultants, with clients including six of the largest energy companies and the United States government.
Now, Dr. Moors is sharing his proprietary research every week… knowledge filtered through his decades as an internationally recognized professor and scholar, intelligence operative, business consultant, investor, and geo-political “troubleshooter.” This publication is designed to give you an insider’s view of what is really happening on the geo-political stage.
You can sign up for FREE to Classified Intelligence Brief and begin receiving insights from Dr. Moors and his team immediately.
Just click here – https://classifiedintelligencebrief.com/