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Sheep's Eyes & Caviar. Like accomplished diplomats, aware of strengths and weaknesses, oilmen are ready to use their new power to play country against country, hold the line against more liberal profit splits. Among them, no man is more skilled in the art of diplomacy than John Hugo Loudon, the Group's senior managing director and Shell's No. 1 man. Says Loudon carefully: "There is a growing awareness in the large exporting countries of the increasing availability of alternative sources of supply. They need to watch that the overall cost of their oil remains competitive.''
At 54, Loudon is handsome, tanned, broad-shouldered (6 ft. 1 in., 180 lbs.), and the very model of the international business diplomat. Loudon (rhymes with howden ) needs to be, for the Group talks business in every major language, has dealings in more than 50 currencies. Sophisticated and charming, he is the friend of desert sheiks and kings, was the only businessman invited to the royal box to meet French President de Gaulle during a gala performance recently at Covent Garden. He speaks five languages fluently (Dutch, English, Spanish, French and German), and can, with equal aplomb, pop a sheep's eye into his mouth while feasting in an Arab tent or dine royally on caviar and champagne.
Where will the next diplomatic move be made? This week, in a gabled Renaissance building in The Hague, John Loudon and the Group's other six managing directors gathered with lieutenants to consider the problems of their empire and plot its future. They met in a dark, wood-paneled room far removed from the noise and distractions of the street, settled into plush blue chairs for three days of secret, hard-headed talks. As each man rose to a flower-decked rostrum to say his piece, he was faced with two rows of buttons that controlled a movie screen and 24 separate charts that silently glided down from the ceiling.
Fervent Embrace. The charts showed that the Group's future has never been brighter. It is building nine refineries to increase its total refining capacity outside North America by 7%. It is participating in seven pipeline projects, including a 24-in. line connecting Shell's Rotterdam refinery with the Ruhr and a line from the Marseille area to Karlsruhe in West Germany, which will save tankers the long trip around the Continent. The Group has strengthened its position in Mideast oil through a deal with Gulf Oil, will have access over the years to 13 billion bbl. of Kuwait oil. U.S. investment trusts have become conscious of the Group's potential. Many, after sharply reducing their holdings in U.S. oil companies (now selling at their lowest prices in five years), have made the Group their new favorite.
The Group is strongest where the world's fastest-growing markets are located. It has the industry's biggest stake (25%) in the thriving European market and a big head start in newly developing countries.
While oil demand will rise 75% in the U.S. by 1975, it is likely to treble in the rest of the free world. Moreover, the Group has strengthened itself for the rigors of new competition by casting off the remnants of cartelism — long European business' favorite form of capitalism — and fervently embracing free enterprise. Says John Loudon: "We are second to none in our belief in free enterprise."