Tokyo (AsiaNews/Agencies) - In order to combat the effects of the rise in the oil price, which has touched 140 dollars a barrel, greater domestic efficiency is needed rather than insistence upon more production from the Organization of the Petroleum Exporting Countries (OPEC). This is the result of the two days of meetings of the energy ministers of the eight most industrialised countries, who gathered in Aomori (Japan), with the participation of China, India, and South Korea.
The 11 nations representing more than 60 percent of energy consumption, including the United States (largest global consumer) and Russia (second-largest producer) have not reached any precise joint positions on producing countries, except for expressing "serious concerns" over the oil price. The OPEC countries have repeatedly rejected requests for increased production, saying that current supply is sufficient to meet demand, and that prices are under control. OPEC sources yesterday repeated that they do not expect to meet before September. Although Saudi Arabia has promised to increase oil production next summer, this has not halted the price rise. This has led to an emphasis on greater efficiency in energy use, and more reliance on alternative sources
Sam Bodman, the United States energy secretary, has charged that "demand is increasing because a lot of nations are still subsidising oil" to keep the domestic price down and foster consumption and development. But India's Hemat Krishnan Singh responded that subsidies are necessary for the development of his country. He was echoed by Zhang Guobao, head of China's energy office, who says that "we still have some weak industries such as agriculture, the taxi industry and the public transport sector". These countries also want to contain inflation, which threatens to undermine economic development.
Since mid-2006, China has increased domestic fuel prices by only 10%, while these have more than doubled on the market, and it spends about 25 billion dollars a year in subsidies for the energy sector, compared to 20 billion from the Indian government. Recently Indonesia, Taiwan, Malaysia, and Sri Lanka have cut their subsidies, which were too great a burden on the state. (PB)