Saturday, 20 December 2008

OPEC calls on UK to cut fuel duty or risk a long-term spike in oil

OPEC calls on UK to cut fuel duty or risk a long-term spike in oil
Oil cartel OPEC has called on Western governments, including Britain, to cut duty on petrol or risk fuelling a much higher oil price in the future.

By Rowena Mason Last Updated: 2:42PM GMT 19 Dec 2008

Saudi Arabia's Crown Prince Sultan at an OPEC summit in Riyadh, November 2007. Photo: REUTERS
Saudi Arabia's oil minister Ali al-Naimi and Abdalla S El-Badri, secretary-general of OPEC, said low demand was "wreaking havoc" for oil producers.
The producers claimed the collapse of prices to a four-year low of $36 a barrel is harming investment in the sector, creating supply problems for years to come. "A number of upstream projects have already been cancelled or delayed," Mr al-Naimi said at a meeting of energy ministers in London.
A cut in fuel duty, according to OPEC, would encourge cash-strapped consumers to buy more petrol, bolster demand for oil and encourage producers to develop new supplies.
Ministers from 27 countries and delegates from oil organisations convened at the London Energy Meeting, hosted by energy and climate change secretary Ed Miliband.
Prime Minister Gordon Brown gave an opening speech at the conference urging OPEC and other producers to continue to invest despite the crumbling in oil prices. Mr Brown also called for greater transparency in oil trading. Western governments have so far resisted the suggestion that speculation plays a large part in shaping oil prices, but the Prime Minister today proposed tougher regulation of the market.
He said "visionary internationalism" was needed to stamp out volatility, which he described as "one of the most pressing problems" for the world today. "Wild fluctuations in market prices harm nations all round the world," Mr Brown said. "They damage consumers and producers alike."
Oil producing members of OPEC blamed some of the severe volatility which has seen oil slump from a record $147 in July to below $40 on speculative futures trading.
The cartel operated by OPEC cut supply by a record 2.2m barrels a day this week, but failed to drive the price of oil back up to its target $75 a barrel. Mr al-Naimi for the first time pledged Saudi Arabia's support for investment in green alternative energy sources, if the "fair and reasonable" target price of $75 a barrel is reached.
The London summit follows a meeting in Jeddah, Saudi Arabia, earlier this year to tackle the huge increase in oil prices to $147 per barrel.
"If anyone had predicted then that oil prices would fall below $40 a barrel at the Jeddah meeting, they would have been transported to a mental institution," said Dr Noe van Hulst, secretary-general of the International Energy Federation.

1 comment:

BeyondGreen said...

We really need to get serious about becoming energy independent. This past year and the record gas prices played a huge part in our economic meltdown. The one single fact of historically high gas prices seriously damaged our economy and society.The average family went broke filling up the family cars alone. Added to that were the sharp increase of groceries and every consumer product due to increased production and shipping costs passed on to us. Utility companies had record price hikes. And, while we do the happy dance at lower prices at the pumps OPEC is planning deep cuts in production to raise the price per barrel back up to between 75-100 per barrel. We spent 168 BILLION on the last economic stimulus pkg that did nothing to stimulate our economy. We are spending billions upon billions in bailouts. Why not spend some of these billions to get some alternative energy projects set up on a national basis? Create cheap clean energy, create badly needed new green collar jobs, and decrease our dependence on foreign oil! I can't think of a more win-win situation for our nation. It cost the equivalent of 60 cents a gallon to charge and drive an electric plug in car. The electric could be generated from wind or solar.If all gasoline cars, trucks, and suv’s instead had plug-in electric drivetrains, the amount of electricity needed to replace gasoline is about equal to the estimated wind energy potential of the state of North Dakota.Get with it! Utilize free sources such as wind and solar. Stop throwing away money on things that don't work. Invest in America and it's energy independence. Create cheap clean energy, create millions of badly needed green collar jobs. Put America back to work. It is a win-win situation. We have to become more proactive citizens, educate ourselves and demand our elected officials move this country forward into the era of energy independence. Jeff Wilson has a profoundly interesting and informative new book The Manhattan Project of 2009 Energy Independence NOW outlines a plan for America to wean itself off.
He also has a fascinating article published on a blog called How Much Electricity Does It Take To Replace Gasoline. You can read it @