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Warning that oil summit could push price up
Terry Macalister, Guardian
An unprecedented meeting of oil producers and users in Saudi Arabia this weekend, aimed at ending the rise in petrol prices, could propel the cost of energy higher, Gordon Brown was warned last night.
As the prime minister prepares to fly to the summit in Jeddah, a leading energy academic said the chances of finding a suitable solution to rocketing prices was limited because the Opec cartel of producers, western oil companies and ministers in consuming countries have conflicting views on what has caused this year’s 40% rise in crude.
Failure to find an eye-catching initiative for what Brown has called “the biggest problem facing the world” could make the situation worse, said Dr Bassam Fattouh at the Oxford Institute for Energy Studies.
(20 June 2008)
Saudi Arabia faces an oil dilemma
Financial Times
Saudi Arabia has elected to pump more crude oil. The decision, to be announced this weekend at a summit in Jeddah with consuming nations and international oil groups, will test Riyadh’s power to move the market. With crude surging to record highs of almost $140 a barrel, the increase in Saudi output is a welcome – and necessary – step if prices are to fall. But, on its own, it is unlikely to reverse supply tightness and its effect on inflation.
That the kingdom has signalled it will try to bring prices back under control is a modest diplomatic victory for the US and other consuming countries.
(19 June 2008)
In Saudi Oil Output Discussions, The Old Clout Will Be Missing
Neil King Jr. and Marc Champion, Wall Stret Journal
Oil diplomacy used to be the province of a small cast of characters with the muscle to make a difference when prices got out of hand.
… But now, with fuel costs again causing pain world-wide, a far more diverse group will take the stage in Saudi Arabia Sunday. Dozens of world leaders and executives are meeting to weigh how to reverse oil prices, which have shot up over 40% this year. Their numbers show how tough finding a remedy is likely to be.
Previous oil shocks were largely the result of wars. This time, crude prices have shot up for many reasons, from an oil-hungry China and a feeble dollar to fears that the world’s petroleum supply is running thin. With oil use now more widespread than ever before, the ensuing economic pain is also global, hurting America’s airlines, spurring protests across Europe and prompting pleas for financial relief in the poorer reaches of Asia and Latin America.
(19 June 2008)
