* In his first OPEC meeting, Falih pledges "no shocks"
* After Doha failure, Saudis trying to change tack
* Saudi energy minister says OPEC has role in balancing
markets
By Dmitry Zhdannikov, Rania El Gamal and Reem Shamseddine
VIENNA, June 3 (Reuters) - Russian oil billionaire Vagit
Alekperov isn't easily swayed, but Saudi Arabia's new Energy
Minister Khalid al-Falih achieved it this week.
Intense diplomacy by the soft-spoken Falih at his first OPEC
meeting - with his speech peppered by words such as "gentle
approach", "no shocks" and "consensus" - has persuaded Alekperov
that OPEC is more alive than dead.
"The fact that OPEC agreed on its new management shows they
want to regain their coordinating role. The cartel will perform
market management again," Alekperov, chief executive of Russian
energy firm Lukoil LKOH.MM , said after meeting Falih and
Iranian Oil Minister Bijan Zanganeh separately in Vienna.
On Thursday, OPEC could not agree to set a clear oil-output
target as Iran refused to limit its own production.
But the meeting was relatively peaceful and free of the
usual clashes between political rivals Saudi Arabia and Iran,
with Falih promising not to flood the market and to listen to
Tehran.
In a rare compromise, OPEC also decided unanimously to
appoint Nigeria's Mohammed Barkindo as its new secretary-general
after years of friction over the issue. Oil prices stood flat at
$50 a barrel on Friday, up 80 percent from their January lows.
Falih, who in April succeeded veteran Ali al-Naimi, was the
first OPEC minister to arrive in Vienna.
He met most fellow colleagues on the sidelines, spent
several hours with independent OPEC analysts and held a long
news conference with reporters.
"If you want to call it (OPEC) a talking shop - I have no
problem with that. But I think it's going to do a lot more than
talking. We are going to do coordination and cooperation ... to
achieve market objectives," Falih said on Thursday.
DRIVERLESS CAR
The nature of Thursday's meeting surprised many OPEC
watchers, who have grown used to acrimonious gatherings.
Falih's ultimate boss, Saudi Deputy Crown Prince Mohammad
bin Salman, effectively scuppered plans to clinch a global
production freeze in the Qatari capital of Doha in April.
Prince Mohammad said Riyadh would not agree to the deal,
which would also have involved non-OPEC Russia, if Iran didn't
join in despite Tehran insisting it wants to regain market share
after the lifting of international sanctions earlier this year.
"After Doha, oil markets were beginning to look like a
driverless car. That needed to change," said a source familiar
with Saudi thinking.
A non-Gulf OPEC source said Riyadh realised it needed OPEC
unity because the group's fight for market share against
higher-cost producers, such as U.S. shale, was taking longer
than expected when formulated in 2014.
"The Saudis trashed OPEC in Doha. But they realised they
don't want to throw away decades of OPEC history and decided to
be more cooperative," said Gary Ross, founder of U.S.-based Pira
consultancy, who came to Vienna together with other OPEC
watchers and analysts for meetings.
"The Saudis definitely decided to change tack after Doha as
they were concerned that people were doubting the viability of
OPEC. I think this softer approach will last," said Amrita Sen,
who also came to Vienna.
Falih acknowledges that Riyadh realised it needs OPEC.
"The markets can ultimately balance themselves but as we
have seen, when we rely on markets alone it is extremely painful
for everybody," he said on Thursday.
"I think managing in the traditional way that we have tried
in the past may never come again ... We will not go with setting
a price target for OPEC ... But (we should be) coordinating
strategies and trying to understand what each of us can and
cannot do."