Renaissance Hotel, Brussels. 25 September 2012. Twenty-four hours until a key vote next door at the European Parliament on how to regulate energy markets. Eighty suited and booted delegates, including a swathe of EC officials and MEPs who will take part in the ballot, lean back in their plush seats as the Shell lobbying machine cranks into gear.
In eight months' time EC officials will be raiding Shell's offices as part of an investigation into price rigging in the region's largely unregulated oil market. For now though Shell - whose AGM is to be held on Tuesday in the Hague - have the upper hand, and they are using it.
"We want to invest more in Europe", Shell CFO Simon Henry beams beatifically. "After all, we're a European company, staffed by Europeans, but... capital is mobile, and EU regulators and politicians need to recognise that", he adds coolly, letting his words do the menacing.
Key to Shell's demands is that legislators leave physical trading of commodities outside the scope of the proposed regulation, known as MiFID II. According to Henry, overly stringent regulation of oil, gas and power trading would be of benefit to no one, and would simply end up hitting European consumers in the pocket. "If our costs [to trade] go up, we will pass it on to our customers - airlines, businesses, and so on - and they will pass it on to the end user, so the cost of living for everyone will go up", he states flatly.
The industry line is that there is no systemic risk in the energy market, that power companies don't require regulating to the same extent as retail and investment banks, and that regulators should thus be deterred from shaking up the incumbent system too much - if at all. As Henry notes, "we all know the feeling that 'something must be done', but sometimes it's best to do nothing... We should have no new regulations for a while, we need to give those currently in place time to work"
Analysts, energy company officials and politicians all murmur their assent from their seats, heads nod in agreement across the room.
The subsequent vote at the European Parliament closely follows the prescribed script, with physical trading exempted from the proposed regulatory reach of MiFID II. Shell and Co. can sleep easy, untroubled by the long arm of the law when it comes to their European business.
A mere eight months later, and the landscape looks very different, a series of seismic events having rocked energy markets to their core. Last week's raid by EC officials on Shell, BP and Statoil, as well as the price-reporting agency Platts sent the strongest signal yet that lawmakers are far from content to heed Henry's call to 'do nothing'. The EC move comes on the back of Ofgem and FCA investigations into alleged price-fixing in the wholesale gas market, sparked by my handing a cache of evidence to the regulators in November 2012.
As a result, the knives are out for the energy companies in the press and political spheres alike, with public outrage increasing with every new revelation aired. But their anger is not directed solely at the likes of BP and Shell, but also at the lax regulatory environment which has allowed such alleged abuses to flourish for years.
With household energy bills and petrol prices soaring, any suggestion of foul play at the wholesale trading level is even more unpalatable, and the political reaction suggests both domestic governments and pan-European legislators are on the brink of coming down as hard on energy companies as they did on banks over Libor. Whether they will be so keen to hear Shell's views over wine and canapés this time round remains to be seen.