Sephiroth feels Cloud drawing close to him, even before the blond gets very close. Partially Jenova, partially just Sephiroth's own awareness of when someone is focusing their attention on him. (Easier these days, now that he isn't famous and inherently the focus of most people's attention wherever he is. Then, he'd been living Cloud's nightmare - feeling watched and judged at almost all times, needing to constantly and consciously maintain appearances for the world. As with many aspects of his life, Sephiroth had hated it while entirely resigning himself to it because he had never been presented with any other option.) Politely, he waits until Cloud indicates that he actually is trying to initiate contact with Sephiroth before acknowledging him.

For all he knew, he was just...being kept under surveillance.

"Parties usually tend to be," he says, a comment that could sound snarky but which, for Sephiroth, is delivered genuinely. It's more sympathetic than sassy. Parties do tend to be loud, and this is why people like himself - and apparently Cloud - don't like them much. "But it's nice to see people enjoying themselves."

If the suggestion there is that Sephiroth gets more vicarious pleasure out of parties than personal pleasure, that's not inaccurate.