British chancellor Brown urges OPEC to stabalise global oil market
British Chancellor Gordon Brown will today call for co-ordinated international action to stabilise the world oil market in the face of the threat of new fuel protests and panic buying by motorists.
As UK petrol stations warned they could run dry within hours if high demand continues, Mr Brown is due to set out a plan for concerted global action that he will take to the annual meetings of the G8 group of major industrialised countries, the International Monetary Fund (IMF) and World Bank.
The British treasury said Mr Brown has met with representatives of 24 countries to take forward the plans, in addition to speaking to representatives of other countries – including oil producing countries – in recent days.
In his keynote speech to the TUC’s annual conference in Brighton, Mr Brown will say: “It is because we understand the problems faced by hauliers, farmers and motorists at a time of doubling oil prices and because we will never be complacent that the first action we must take is to tackle the cause of the problem: ensuring concerted global action is taken to bring down world oil prices and stabilise the market for the long term.”
Mr Brown’s plan would involve:
:: OPEC (Organisation of Petroleum Exporting Countries) raising oil supply to meet growing demand – including increased demand from the rapidly growing Asian economies now responsible for consuming 30% of world oil supplies, including China consuming 10% alone.
:: OPEC to open its books to improve the transparency of the world’s oil reserves, increasing stability and reducing speculation.
:: Some of the additional revenues of oil producing countries generated by the doubling of oil prices – estimated at over $800bn (€651bn) in total – to be used to fund new investment in production and refining to increase oil supply.
:: Concerted action to increase the use of alternative sources of energy and greater energy efficiency – and the World Bank to set up a new fund to support developing countries investing in alternative sources of energy and greater energy efficiency.
In the next 25 years, the International Energy Agency estimates that $16 trillion (€13 trillion) needs to be invested in the world’s energy systems to meet demand.
:: The IMF to create a new facility for poor countries hit by oil price and other commodity price shocks and the use of some of the additional resources of OPEC countries from the recent price shock – some $300bn (€244bn) – to help debt-ridden poor countries to write down their unpayable debts.
