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A Look Inside The Fight Against ISIS In Kobani; President Putin Blames West For Russia's Recession; Woman Arrested in UAE for Murder Of American Teacher; Afghan Leaders Plan Trip To Raise Money; New York Police Officer Not Indicted in Civilian Death; Al Qaeda Group Threatens US Hostage

Aired December 4, 2014 - 11:00   ET


BECKY ANDERSON, HOST: CNN goes inside Kobani. We gain exclusive access to the besieged Syrian town and get a true sense of the devastation.

We'll be live with Nick Paton Walsh in just a moment for what he saw there.

Also ahead, an arrest in the Abu Dhabi shopping mall killing. Police say the suspect is an Emirati woman who wanted to, and I quote, "create

chaos and spread fear."

And as the ruble tumbles, Vladimir Putin warns of tough times ahead and says the west is trying to keep Russia down.

ANNOUNCER: Live from CNN Abu Dhabi, this is Connect the World with Becky Anderson.

ANDERSON: A very good evening. It is 8:00 p.m. here.

First, a look at what it's like on the frontline in the battle against ISIS. A CNN crew managed to get inside Kobani, the city at the heart of

the battle in northern Syria. Senior international correspondent Nick Paton Walsh went alongside fighters trying to keep the city from falling

into the radical militants' hands. He joins me now in Turkey not far from the Syrian border -- Nick.

NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT: Becky, after months of seeing Kobani enraged in that conflict from the hills overlooking

in Turkey, it is remarkable to stand in its streets and see the scale of devastation, to hear the almost constant crack of explosions and heavy

machine gun fire, a quite chilling scene.


NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT: From inside Kobani, the days ferocity gets no respite at night, a prize so small, but

so valued that violence seems to swallow it whole, grinding its streets down to the bone.

We're heading to the front line where nightly, daily, ISIS hoped to advance with Meedya, a Kurdish female fighter also in their egalitarian

world this unit's commander.

Coalition air power did this, pushing ISIS back. They abandon their dead as they retreat, the decaying smell haunts these front lines.

Some call it Kobanigrad after the city Stalin sacrificed to make a point.

Little left here, but a bulwark of Kurdish defiance 20 meters from ISIS.

They think they see something in the rubble.


WALSH: Even after coalition support, desperately in need of better arms.

It's the kind of exchanges that happen here hourly. ISIS literally meters to that side shooting at this position, but receiving return fire as


This surely wasn't the death ISIS recruits were sold in their propaganda videos.

Mortars are often used, so we pull back.

UNIDENTIFIED MALE: Up against the wall. You against the wall.

WALSH: Meedya is 22 and has been within five meters of ISIS. Here, friends are made and lost. Her best friend Reeban (ph) died saving others.

MEEDYA RAQQA, YPG KURDISH COMMANDER (through translator): There were very heavy clashes with ISIS. We were outnumbered and out of ammunition.

She herself was injured, but she advanced to help save the other injured with her. ISIS surrounded her, because girls are very prized by them. She

then blew herself up and killed a lot of them with her.

I was near her then. Her last words were to me were, we will liberate our land with the last drop of blood in my body.

WALSH: The men bring us tea. This is the polar opposite of ISIS's worldview.

They cannot afford to stop the fight, even if that means there's little left to live on when they do.


WALSH: Now Becky, when you're actually inside the city, we had heard before that ISIS controlled about a third of it, had been pushed back. It

did seem inside that where those front lines were ISIS have more than that. The YPG Syrian-Kurds today claimed to have taken back some key

neighborhoods in the southeast, but I think most of the estimates we heard inside were that they, ISIS, still have about 40, 50 percent of Kobani.

The fight for it, really, in the balance every day and night when you hear the rounds being exchanged. And those Kurds, as you saw there running

out of food and fuel as winter approaches and more particularly ammunition and the kind of weapons they need, Becky.

ANDERSON: Remarkable stuff.

Nick Paton Walsh reporting. Nick, thank you.

It was an attack that shocked a city and a nation. Police say the Emirati woman suspected of killing an American teacher at an Abu Dhabi

shopping mall intended to kill again.

Authorities in the UAE have stopped short of calling Monday's traumatic events here in the capital an act of terror, but after the fatal

stabbing and the placing of a homemade bomb outside a doctor's hose directly afterwards, they do say the suspect seemed intent on spreading

fear and chaos.

Well, earlier police released new footage of the dramatic aftermath.


ANDERSON: 48 hours after the stabbing death of an American woman in a shopping mall toilet, UAE police raid the house of an Emirati woman in her

late 30s and take her into custody.

The woman is suspected of stabbing to death 47-year-old Ibolya Ryan on Monday.

These images show a veiled figure on a mission of malice. Police now say shortly after the stabbing attack, the mysterious suspect was already

aiming at her next target, another U.S. citizen, this time a Muslim American doctor with a homemade bomb.

Fortunately, this plan was foiled. But who is this woman? And what are her motives?

How old is the suspect? What does she do? And are you dealing with this as a terror case?

UNIDENTIFIED MALE; She's nearly 38-years-old and she's from the UAE. And about the last point of your question, this is under investigation now

and I cannot (inaudible) now.

ANDERSON: What authorities will say is that the suspect probably meant to spread chaos and fear.

The car in which she fled the scene of the killing had several knives and walkie talkies.

Whatever the circumstances, they are certainly highly unusual in a city renowned for safety. And the police video purporting to show the

suspect's arrest catches a drama few would associate with the UAE.

Now the Emirates is on guard.

Ever since the Gulf nation took on a leading role in the coalition fighting ISIS, it's been increasingly susceptible to extremist retaliation.

And on top of it, there's a glaring rift in the region between moderate and radical factions.

The Emirati foreign minister highlighted the existential dangers at the UN general assembly earlier this year.

ANWAR GARGASH, MINISTER OF STATE FOR FOREIGN AFFAIRS UAE: I think it's indicative of the threat that everybody feels is common. Nobody is

basically immune. Everybody is threatened, the way of life, the values, this is I think a danger to all of us, terrorism. And I think this is

indicative of how the coalition was built on the sense that we need to act. It -- we can't be passive.

ANDERSON: The UAE has long enjoyed a reputation as an oasis of calm in a turbulent and often violent part of the world.

It's the modern face of the Middle East, attracting millions of tourists with its beaches, shopping and golf courses, and home to Dubai

International Airport, one of the world's busiest.

But for now, the uncertainty over this mysterious woman and her intentions has this normally peaceful nation on edge.


ANDERSON: More on what this incident means for the UAE and whether or not this attack will change this Gulf state's foreign policy.

Let's bring in our regular contributor Fawaz Gerges, chair of the contemporary Middle East studies program at the London School of Economics,

a regular guest on this show.

Quite unusual for me to be doing a story from here with you certainly in London these days for me. But from the outside and the reason that this

country got involved in the coalition they say is the existential threat that the UAE believes it and the wider region faces. And if an attack like

this one, though they are falling short of actually calling it a terror attack, but surely they will suggest will mean their sometimes criticized

anti-terror policy here is correct.

FAWAZ GERGES, LONDON SCHOOL OF ECONOMICS: Well, Becky, as you just suggested the United Arab Emirate is a very active member in the U.S.-led

coalition against ISIS. Also, another complicating factor, the United Arab Emirates has been waging a relentless campaign against Islamists of all

colors and persuasions. Just a few weeks ago, the government basically listed dozens of Islamist religious based activists and put them on its

terrorist watch.

So in this particular sense, the United Arab Emirate is really on the front line. It's waging a campaign not only against ISIS, but against all

kinds of Islamist -- and this basically not only complicates the security situation, it could basically -- I mean, inspire, motivate some radicals in

order to attack the country and basically retaliate against its polities.

ANDERSON: Well, and that is clearly a concern here this evening and indeed over the past couple of days.

I want to go back to something that you just alluded to there, this extensive list of groups and people who have been designated as terror

organizations or belonging to terror organizations been widely criticized outside of this region, certainly, by groups like the Human Rights Watch,

for example, how say that it simply doesn't hold water. And the sort of powers that this legislation extends to a government like this one is way

too extensive.

How would you respond to those sort of criticisms?

GERGES: Well, you know, Becky, this is not just a product of the last few weeks. This has been going on for almost one or two years. The

leadership of the United Arab Emirates has basically made a conscious decision to basically crackdown against Islamists. They believe that the

Islamist ideology, the ideology of the Islamist groups, not just ISIS, even the Muslim brotherhood, even the mainstream Islamists represent an

existential threat to the country.

And in this particular sense I think now the United Arab Emirates is really on the front line. It's really an active member not only of the

U.S. coalition, but also a country that has decided to wage all-out war against Islamsits.

If I might say one word about this particular sense, this is not just about the United Arab Emirates, Becky, you have an Arab Civil war now. And

this civil war is between Islamists on the one hand, religious-based activists and nationalists. Nationalists basically in Egypt, in Libya and

the United Arab Emirates and the United Arab Emirates now has made a strategic decision to basically battle the Islamists not just in the United

Arab Emirates, even in Egypt and in Libya.

The United Arab Emirates now is playing a leadership role in this particular Arab civil war that's raging in the region.

LU STOUT: Certainly the foreign minister and a delegation represented at the meeting that Kerry was chairing at NATO, which there were other

dignitaries and not necessarily NATO members recently.

But there to listen to, and one assumes discuss behind closed doors, with others any potential change in strategy as this war is fought against


Also looking to, I'm sure, and reports of, Iranian jets in the skies over Iraq, for example, and the involvement that many believe Iran is

having in this war against the militant group.

Do you expect to see a change in policy in the short-term going forward?

GERGES: No, Becky, I don't think there is any qualitative shift in the American strategy. As you know, the American strategy is basically

prioritizes Iraq. The theater is Iraq, they want to roll back the ISIS advances. They want to help the Iraqi forces stand up the Kurds, the Iraqi

government's Sunni and Shiite allies. They want to dislodge ISIS from Mosul, Takrit, Fallujah.

And of course Syria is a secondary theater. The meeting yesterday in Brussels was really basically a review of the strategy, to go beyond the

military attacks by focusing on ideology, focusing on basically preventing ISIS from getting financed, starving the ISIS financial system and also

develop strategies to deal with the outreach and ideologically outreach of ISIS.

In this particular sense, the United Arab Emirates, Becky, is one of the most important partners for the United States, for your own viewers.

In fact, I would argue it's the most important member in this coalition now. It's active. It's proactive. And it has basically made a critical

decision to go all the way not only against ISIS, but what it perceives to be the Islamist threat in the region as a whole.

LU STOUT: Fawaz Gerges, we thank you. You are an expert on the subject tonight.

Still to come on Connect the World with me Becky Anderson, anger on the streets of New York as protesters demand justice for a man who died

while being arrested. Details on that are just ahead.

And tonight, we'll look at Vladimir Putin's popularity at home. Russia's president enjoys record ratings, but can he weather an economic

recession? That after this.


ANDERSON: All right, you're watching CNN. This is Connect the World with me Becky Anderson. Welcome back.

We turn to Chechnya in southern Russia now where at least 10 police officers were killed and 28 other people wounded in a fight with militants.

A group of armed men arrived in three cars and attacked a police post in Grozny, then stormed a building that houses local media.

Well, Russian anti-terror authorities say the militants were planning several attacks on the city. Police say the gunmen have been, quote,


Well, the attack on Grozny came just hours before Russian President Vladimir Putin gave a fiercely patriotic state of the union speech. He

said Russia's adversaries want to destroy its enemy -- sorry, its economy to punish it for becoming strong.

Well, the Russian economy is in crisis as the ruble has fallen in value this year brought on by falling oil prices and sanctions by western



VLADIMIR PUTIN, PRESIDENT OF RUSSIA (through translator): Every time when somebody believes that Russia became too powerful, too self-reliant,

and this strategy is switch on immediately. It makes no sense to threaten Russia.


ANDERSON: Well, the latest poll numbers out of Russia show just how enduring Vladimir Putin's popularity is. This is what the independent

Levada Center found in a poll conducted late last month. When asked whether they supported his actions as president, nearly three-quarters of

Russians said yes. With one exception two years ago, that number has not dipped below 60 percent in more than a decade.

And speaking of longevity, a majority say they want to see Mr. Putin run for president again in 2018.

Now if he were reelected, an additional term would potentially put him in office either as president or prime minister for almost 25 years.

Well, for more on this speech and what it might mean for Russia's relations with the west, our senior international correspondent Matthew

Chance joining us now from Moscow.

And Matthew, I want to go back to some of those images that we saw out of Chechnya. Last time that President Putin waged a war with Chechnya his

popularity soared. Will this do him another favor in what are already great poll ratings, it seems?

MATTHEW CHANCE, CNN INTERNATIONAL CORRESPONDENT: No, I don't think so. I don't think this attack in Grozny is going to have any impact

whatsoever on Putin's popularity ratings.

The territory now is more or less under the control of Ramzan Karadirov (ph) who is the Kremlin appointed president of the Republic of

Chechnya. It may or may not have an impact on his popularity with the people, but that's doubtful even saying that.

I mean, the fact is this is a pretty rare occurrence taking place inside Grozny. It is an essentially heavily fortified city. The days of

heavy conflict there are over. But you do get these periodic attacks and this is a particularly nasty one. We've seen at least 18 people killed, 10

policemen, eight militants. And you know now that the crisis is over, but I mean, I expect there will be more attacks like this in the future,

because there's still a number of people in Chechnya and in the surrounding north Caucuses who are opposed to the Kremlin and who want to, you know,

create an Islamic caliphate in the region.

ANDERSON: Interesting. All right.

Let's talk about this speech that we heard earlier on today. Defiant, anti-western, some might call it jingoistic, certainly admitting to

recession or the potential for economic recession, but blaming the west.

How will that speech go down with the general public?

CHANCE: Well, I think that will go down well. It -- you see the thing with Vladimir Putin, he's not so much molded Russian society as being

a product of it. I mean, the views he expresses are views that are genuinely held by a vast number of people inside Russia despite what

opposition figures in this country might say.

I mean, the fact is I haven't met anybody in this country who is opposed to the annexation of Crimea and what Vladimir Putin described as

its historical reunification with Russia.

He dwelled on that subject again today. He got a big round of applause. It's something that many people watching this in Russia will

have agreed with.

His point that made about the sanctions not because of what's taken place in Ukraine, but because of a continuing kind of Russian -- sorry,

western conspiracy to clip the wings of Russia. That's also, it's his view, but it's also a deep-seeded view held by very many Russians as well.

And so this is a figure who is able to capture the Russian mood and to, you know, kind of make speeches that really truly reflected it in many


ANDERSON: Matthew Chance reporting from Moscow. Matthew, thank you.

Live from Abu Dhabi, this is Connect the World with me Becky Anderson. Coming up, footage emerges of a U.S. journalist pleading for his life. al

Qaeda is threatening him with an inevitable fate if his demands aren't met.

That is coming up. You're watching CNN. Stay with us.


ANDERSON: Well, Afghanistan's new leaders are in London today asking the world to stick by their country at what is a very critical time. At

the end of this year, NATO's 13 year combat mission ends, leaving Afghan forces in charge of security.

Senior international correspondent Nic Robertson has the details.


NIC ROBERTSON, CNN INTERNATIONAL CORRESPONDENT: The new Afghan leaders' first big international trip, they're looking for help. The

country is broke.

MICHAEL SEMPLE, QUEENS UNIVERSITY: Their tax take is simply not adequate to pay for the normal, humdrum affairs of government.

ROBERTSON: Pressures on the pair, President Dr. Ashraf Ghani and Chief Executive Dr. Abdullah Adbullah could not be higher. NATO handing

them lead on security, close to 5,000 Afghan security forces killed this year, the deadliest for them since NATO first arrived 13 years ago.

SEMPLE: If things were handled wrongly, Afghanistan could go the way of Iraq. You could see a collapse of the state. You could see the rise of

a new movement, which would be far more radical and dangerous than the current Taliban movement.

ROBERTSON: Semple has decades of experience with Afghans, including Taliban leaders. His fears, shared by New York Times journalist and author

of The Wrong Enemy Carlotta Gall, based in Afghanistan for 13 years.

CARLOTTA GALL, NEW YORK TIMES: The Taliban are fully hoping to do a similar surge like ISIS and come through. They're still set on

establishing an Islamic caliphate again.

ROBERTSON: Underscoring the threat, just as the leaders preparing to leave, two separate high profile Taliban attacks in the heart of the

capital Kabul, one targeting British diplomats, a suicide car bomb killing two embassy officials and three Afghans nearby.

Later the same day, South African aide workers the target: a father and two of his teenaged children killed.

Afghan security forces far from ready to run security alone.

GALL: Afghans are saying we need much longer to get it right, because they don't have heir own air force. They don't have their medevac


ROBERTSON: In the south last week, the Taliban gave a taste of what NATO's drawdown will look like, attacking the major base British troops

only weeks ago handed over to Afghan forces. The fight lasted three days.

SEMPLE: However much they build up, I don't think that the -- and the Taliban really are going to be able to take Kabul as long as the money

keeps on flowing and as long as the two doctors stay together.

ROBERTSON: Both big ifs. London, a test of the money flow. Ghani and Abdullah, from opposite sides of the country's ethnic divide, untested

in their new roles.

Nic Robertson, CNN, London.


ANDERSON: Well, the latest world news headlines are just ahead.

Plus, protesters took to the streets of New York and around the U.S. angry at the police again. We'll tell you about the latest case that

sparked this outrage.


ANDERSON: This is CONNECT THE WORLD with me, Becky Anderson. The top stories for you this hour.

The United Arab Emirates have arrested a woman in connection with the murder of an American teacher at an Abu Dhabi shopping mall. It's still

unknown whether the woman acted alone or as part of a terror cell. Authorities say that is still under investigation.

The militant group al Qaeda in the Arabian Peninsula released a video of American hostage Luke Somers pleading for his life. The photojournalist

was kidnapped in September 2013, and the video warns Somers will meet an inevitable fate if demands are not met. The video also says Washington

knows what those demands are. There are no indications as of yet of a US response. More on that in a moment.

Russian president Vladimir Putin gave a fiercely patriotic state of the union speech earlier Thursday. He said Russia's enemies want to

destroy its economy to punish it for becoming strong. The Russian economy is headed for a recession intensified by falling oil prices and Western


Thousands of people hit the streets of New York and other US cities to protest the grand jury ruling. The panel decided not to indict a white

police officer in the choke-hold death of an unarmed African-American man last July. The arrest was caught on video.

These latest demonstrations against police brutality come just after - - days after violent riots in Ferguson, Missouri, you'll remember. That was last week. But this time around, the message was clear: keep it

peaceful. Jason Carroll reports.


CROWD (chanting): I can't breathe! I can't breathe! I can't breathe!

JASON CARROLL, CNN CORRESPONDENT (voice-over): Protesters pouring into the streets of New York last night after a grand jury did not indict

New York City police officer Daniel Pantaleo in the choke-hold death of 43- year-old Eric Garner.

BILL DE BLASIO, MAYOR OF NEW YORK: It's a very painful day for so many New Yorkers.

CARROLL: Arrests made throughout the night as outrage pulsed throughout the city streets for more than nine hours.

CROWD (chanting): Black lives matters! Black lives matter!

CARROLL: Most chanting Garner's last words --

CROWD (chanting): I can't breathe! I can't breathe!

CARROLL: -- before dying on this Staten Island street.

ERIC GARNER, BEING SUBDUED BY POLICE: I can't breathe! I can't breathe!

CROWD (chanting): I can't breathe! I can't breathe!

CARROLL: Police, some in riot gear, blocking intersections as protesters began shutting down the city's most iconic landmarks. Stopping

the flow of traffic into and out of the island of Manhattan for hours. Some lying down right in the middle of the road. The same inside Grand

Central Station --

CROWD (chanting): I can't breathe! I can't breathe! I can't breathe!

CARROLL: -- where other protesters staged a massive die-in as evening rush hour hit its peak. Police heavily guarding the Rockefeller

tree-lighting ceremony --

CROWD: Three! Two! One!


CARROLL: -- as protesters tried to disrupt the show. The city's public outcry reaching a fever pitch nationwide.

CROWD (chanting): These killer cops have got to go!

CARROLL: From Los Angeles --


CROWD (chanting): I am Eric Garner!

CARROLL: -- to Philadelphia --

CROWD (chanting): Hands up! Don't shoot! Hands up! Don't shoot!

CARROLL: -- where protesters took to city hall during their tree- lighting ceremony, holding up signs reading, "Black lives matter." The demonstrations across the country, disruptive but peaceful, fulfilling

Garner's family wish.

GWEN CARR, MOTHER OF ERIC GARNER: Yes, we want you to rally, but rally in peace.

BEN CARR, STEP-FATHER OF ERIC GARNER: No violence. That's all I ask.

CARROLL: Officer Pantaleo said in a statement, "It is never my intention to harm anyone, and I feel very bad about the death of Mr.

Garner." But Garner's wife says it's too late.

ESAW GARNER, ERIC GARNER'S WIDOW: Hell no. The time for remorse would have been when my husband was yelling to breathe! That would have

been the time for him to show some type of remorse or some type of care for another human being's life.


ANDERSON: An American hostage held captive by a militant group in Yemen pleads for his life in a video released by al Qaeda in the Arabian

Peninsula. Now, the group says that the US has three days to agree to unspecified demands.

US and Yemeni forces conducted a raid last week on the group's hideout. They freed eight hostages, but Luke Somers had already been

moved. In the video, Somers says he feels certain his life is in danger.


LUKE SOMERS, AMERICAN HOSTAGE IN YEMEN: My name is Luke Somers. I'm 33 years old. I was born in England, but I carry American citizenship and

have lived in America for most of my life.


ANDERSON: Well, the photojournalist was kidnapped just over a year ago. Our Pentagon correspondent Barbara Starr, live from Washington with

more. Barbara, the demands aren't specified. The video also says that Washington knows what the demands are. You've been working your sources.

Do we have any more details at this point?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: We just don't, Becky. If anyone in Washington or in the Obama administration knows, they aren't

saying at this point. And of course, US policy remains the same that the US government does not negotiate for hostage releases from terrorists.

This case has been very difficult. In fact, it was really only several days ago that it became more public that a man named Luke Somers

was being held by al Qaeda in Yemen, one of the most dangerous al Qaeda affiliates out there.

The public account is that he is a photojournalist and he went there to work, and he was captured late last year in September of 2013. But

there's been very little information about him, and his family has not spoke out publicly.

The official response from the Pentagon, if there is one, is that they're still looking for him, they still hope to find him. But deep

inside of the bowels, if you will, of al Qaeda in Yemen, this may be a very difficult proposition. Becky?

ANDERSON: Barbara Starr in Washington for you. Thanks, Barbara.

The fight against ISIS is one of many stories coming out of this region that has dominated global headlines, and the leader of the terror

group, Abu Bakr al-Baghdadi, was one of the candidates in our quest to find the most influential figure in the Middle East this year.

At this time tomorrow, I'll host a special town hall edition of CONNECT THE WORLD from Dubai, in which we'll debate and reveal the pick for

the Influencer2014.


ANDERSON (voice-over): Who has had the most influence on the Middle East in 2014?

UNIDENTIFIED MALE: Nine million people on the move from their homes, without schools, without family. This is not just a catastrophe. This is

a cataclysm.

UNIDENTIFIED MALE: I consider King Abdullah is the influencer of 2014.

UNIDENTIFIED MALE: Usually, when you have them in the millions, we find it very hard to brand these Muslims as a block, and you lose all kinds

of emotional connection.

UNIDENTIFIED FEMALE: I think Baghdadi is the most obvious influencer, because they're influencing all the other ones.

ANDERSON: Cast your vote. Join us in Dubai for a special edition of CONNECT THE WORLD as we reveal the Middle East's Influencer 2014.


ANDERSON: That is Friday, 8:00 PM in Abu Dhabi, 4:00 PM if you are watching in London, and if you're watching elsewhere, I hope you are,

you'll work the times out for yourself, only on CNN. You can join the conversation online anytime by getting in touch with me and the rest of the

team. Head to You can always tweet me @BeckyCNN, that's @BeckyCNN.

Well, that was CONNECT THE WORLD for this evening. Thank you for watching. For -- from the team here -- let me get my teeth in -- from the

team here in the UAE it is a very good evening.


JOHN DEFTERIOS, HOST: Divided or united, all eyes on OPEC. Energy ministers met in Vienna against the backdrop of slowing demand and

plummeting prices. In a special edition, MARKETPLACE MIDDLE EAST heads behind the scenes at the latest ministerial gathering to get an in-depth

look at the cartel's crude concerns.

Welcome to MARKETPLACE MIDDLE EAST. The scenic city of Vienna is home to the oil producers' club, the Organization for Petroleum Exporting

Countries, or OPEC. This week, we take you on a behind-the-scenes look at an OPEC meeting and how this group has tried to influence pricing for over

a half a century.


DEFTERIOS (voice-over): Established in autumn 1960, five oil-rich countries of the world met in Baghdad and signed on the dotted line to form

OPEC. More than five decades on, there are now 12 members, and they sit on top of more than three quarters of the world's proven reserves.

Most of that crude sits under the sands of the Middle East, a region dominated by conflict, which time and again has put the group's power to

the test. In 1973, an OPEC oil embargo on the United States after the Arab-Israeli war introduced fuel rationing and long queues at fuel stations

across America. This was the world's first experience of OPEC's economic might.

Since then, OPEC's power has waxed and waned, from a price collapse in the 1980s where prices fell to below $10 a barrel, to a price surge in July

2008, where crude hit a record $147 a barrel.

DEFTERIOS (on camera): In the past, OPEC members would meet at their headquarters day and night for a week, if not longer. But in the last four

years of $100 oil, they've had to do very little. Now, with the advent of US shale production, that power has waned.

DEFTERIOS (voice-over): It was billed as the most important OPEC meeting in years, and it lived up to expectations with far-reaching


DEFTERIOS (on camera): Minister, any comment here?

DEFTERIOS (voice-over): And it all happened under the glare of global media.

DEFTERIOS (on camera): This is part of the media circus at the OPEC secretariat. You know he's gauged the oil market by the turnout. We're

told by OPEC that 300 analysts and journalists applied to come to the 166th meeting.

DEFTERIOS (voice-over): OPEC had not had this much attention since prices slid, $100 a barrel in the second half of 2008. It meant plenty of

theater for this man, Saudi Arabian oil minister Ali Al-Naimi, who entered OPEC headquarters with a plan to leave the group's oil output where it is

at 30 million barrels a day, despite falling prices. He emerged with that strategy intact and pleased with the income.

DEFTERIOS (on camera): So, there's no production cut --


UNIDENTIFIED FEMALE: Sir, no production cuts?


ALI AL-NAIMI, SAUDI ARABIAN MINISTER OF PETROLEUM: I told you before that three's no cuts.

DEFTERIOS: So, they stuck with this idea that you don't need cut, just let the market determine the price?

AL-NAIMI: That's right.


DEFTERIOS: As you predicted.


DEFTERIOS (voice-over): It appears OPEC is flooding the market with extra crude, hoping to bring down US shale producers, who have a much

higher cost of production.

DEFTERIOS (on camera): Are you sending this signal that you're happy to let prices drift lower because of market share?

AL-NAIMI: No, we are not -- singling -- we are not sending any signal to anybody. As I said many times to you that we don't want to panic. I

mean it.

DEFTERIOS: Do you agree with this strategy?

DEFTERIOS (voice-over): That is the official position. But members like Algeria, Iran, and Nigeria, with bigger populations and budget

constraints, had little choice but to go along with that stance. With prices hitting a five-year low after the Vienna gathering, it is not clear

whether Saudi Arabia will be able to maintain support until the reconvene in June.


DEFTERIOS: So, what really is at stake here? It's been described as a watershed meeting, but is it all about prices? When in fact oil was

trading above the century mark, the Middle East producers of OPEC were earning about $2.5 billion a week.


DEFTERIOS (voice-over): Saudi Arabia, with production of over 9.5 million barrels a day, would have pocketed nearly $1 billion a week. The

UAE, just under $280 million, and Libya, despite seeing production drop to 490,000 barrels a day during the revolution in 2011, would have banked just

under $100 million a week.

DEFTERIOS (on camera): There's the danger, of course, that a 30 percent fall in prices can divide OPEC going forward. Some wanted to hold

production the same. Others, in fact, were suggesting immediate action.

YOUCEF YOUSFI, ALGERIAN MINISTER OF ENERGY: I think that we should analyze the imbalances of the market today and take a decision as soon as

possible in order to correct the imbalances in the market.

UNIDENTIFIED MALE: The correction the board is feeling at the moment, its already 300,000.

DIEZANI ALISON-MADUEKE, NIGERIAN MINISTER OF PETROLEUM: Well, a lot of us are feeling the pain right now. But again, we have a situation where

we have OPEC and we have non-OPEC. And I think that very shortly now, both sides of the coin will have to share the burden of oil -- falling oil


SUHAIL AL-MAZROUEI, UAE MINISTER OF ENERGY: We are not targeting price, we're targeting the market stability. And the market stability will

incentivize investment. And that level of investment that is incentivized will be driven the long-term sustainability of the production.


DEFTERIOS: That's our view from inside OPEC and some of the major players. When we come back, we'll delve into US shale production and some

of the Middle East investment going into it. Plus, my sit-down interview with Iran's energy minister, Bijan Zangeneh.


DEFTERIOS: Welcome back to MARKETPLACE MIDDLE EAST, this week from Vienna, where the holiday season is in full swing. We know that OPEC is

responding to the threat of US shale production by not cutting its own output. But there's a lot of money going into North America to see that

production go up. Amir Daftari takes a closer look.


AMIR DAFTARI, CNN INTERNATIONAL CORRESPONDENT (voice-over): Abu Dhabi is a city built on oil. But a new era in the industry is dawning. The

shale revolution has seen the US rise to the ranks of Saudi Arabia and Russia in oil production. Prices have plummeted on recent over supply,

sparking talk of a new world order.

But those right here in the Gulf are hedging their bets. Countries like Kuwait, Qatar, and the UAE are diversifying their energy economies by

investing in the opposition.

For these Gulf nations, the rise of North American oil and gas is not just a threat, it's an opportunity, too. Kuwait's foreign petroleum

exploration company has already poured in $1.5 billion into an oil-rich Canadian shale deposit.

The 30 percent stake is in partnership with the US oil company, Chevron. Further south, there's a $10 billion plan for Qatar to help the

US export their shale gas from Texas.

The UAE, too, says it's considering splashing some of its money across North America, and the world's biggest oil exporter is also eyeing up US

deals. Saudi Arabia's petrol-chemical giant, SADAF, says it's in talks with several companies.

DAFTARI (on camera): For now, investment in North American shale is seen as just a backup plan. If OPEC counters the competition and oil

prices rise again, it will remain just that. And so, the crude beneath my feet will continue to build this region's economy for years to come.


DEFTERIOS: Amir Daftari looking at the investment going into US shale production.

Iran's been starving for investment, living under a sanctions regime. But it has huge potential in energy: 157 billion barrels of proven

reserves. And it has the largest gas reserves as well. I sat down with the energy minister, Bijan Zangeneh, to talk about its potential and the

recent decisions by OPEC.


BIJAN ZANGENEH, IRANIAN ENERGY MINSTER: I don't think it will serve to all OPEC member countries because some of the OPEC countries were --

disagreed with the settlement. But for the unity and solidarity of OPEC, we decided not to do anything against it.

DEFTERIOS: You were the minister during the so-called "Golden Era" of Iranian production, when it was about 4.4 million barrels a day. Your

output now is about half that, 2.7 million barrels a day. How long would it take to get up to 3.8, 4 million barrels again if the sanctions were


ZANGENEH: After two months after lifting the sanctions, we can reach to 3.8 million barrels of crude. We can reach during maximum four years,

in crude oil to 4.7 million barrels.

DEFTERIOS: You have 157 billion barrels of reserves, the largest gas reserves in the world. Is OPEC and the rest of the world ready to have

Iran come onto the energy market in such a big way?

ZANGENEH: Why not? Immediately after lifting the sanctions, it's our right to come back to the market and to have our share in the market.

DEFTERIOS: But geopolitically, are people ready for Iran with that sort of power in the world?

ZANGENEH: I think the world wants to diversify the -- power of the production. It's not good for the oil to concentrate -- to the world to

concentrate all on one or two producers.

DEFTERIOS: Finally, do you think, in fact, this action by OPEC and some of the more powerful members will bring the United States and the

Republic of Iran actually closer together as allies? Could this be an outcome of that?

ZANGENEH: I think after lifting the sanctions, strategically, we can work with each other. And before it, we have no sanctions against US

companies. We are ready. Iran is open for US companies.


DEFTERIOS: A closer look at Iran's energy potential with the minister, Bijan Zangeneh. And that's all for this edition of CNN

MARKETPLACE MIDDLE EAST, this week from Vienna. I'm John Defterios, thanks for watching.