Oil/World economy

Produce more oil to avoid recession, say ministers

Article published on the 2008-06-08 Latest update 2008-06-08 14:30 TU

Ministers at the oil summit
(Photo: Reuters)

Ministers from eleven countries which consume two-thirds of the world's energy called for an urgent rise in oil production at a meeting in Japan. The eleven nations called for increased investment to satisfy rising global demand. The Japanese Energy Minister warned that oil prices, which saw their biggest-ever rise in a day on Friday, could lead to a worldwide recession.

A joint statement promised that the signatories would increase their own production and asked major oil producers "to increase investment to keep markets well supplied in response to rising world demand."

The meeting expressed "serious concerns" over oil prices and said there is "an urgent need for increased and timely investment in the energy sector".

"If we leave this situation as it is, it could lead to a recession of the world economy," Japan's Energy Minister Akira Amari said as he opened the meeting. He said that the eleven countries represented consume 65 per cent of world energy and release 65 per cent of carbon dioxide emissions.

Paris-based economist Ali Fatemi believes that at least 50 per cent of the recent price rise was due to speculation and says that can be countered by better information.

"Data should come out much better than it does now in terms of availability of reserves, in terms of consumption," he told RFI. "There is inadequate information on the market and therefore speculation continues."

European Energy Commissioner Andris Piebalgs called for "investments in clean, efficient energy technology and energy resources now".

The meeting comes ahead of a G8 summit which is expected to discuss climate change.

The G8 is made up of Britain, Canada, France, Germany, Italy, Japan, Russia and the United States. China, India and South Korea were also present at the energy meeting.