Saudi Arabia, the world's top oil exporter, is to host an international energy conference on Sunday to discuss ways to brake the free-wheeling rise in oil prices.
The meeting, to be held in the Red Sea city of Jeddah, will gettogether world's major oil producers and consumers as well as leaders from big oil firms and international organizations. Chinese Vice President Xi Jinping, U.S. Energy Secretary Samuel W. Bodman, British Prime Minister Gordon Brown and Secretary General of the Organization of Petroleum Exporting Countries (OPEC) Abdullah al-Badri are among the expected participants.
As an oil exporting giant, Saudi Arabia undoubtedly has accumulated enormous fortune from the price hikes. So questions may arise on why it is so enthusiastic for such a meeting.
TO EASE PRESSURE, SHOW DETERMINATION
Saudi Arabia, with over one-fifth of the world's oil reserves, wants to use the upcoming meeting to respond to the mounting criticism that the country has not done enough to boost production capacity further.
The Asian country is now under unprecedented pressure as the world's oil prices have witnessed historical highs time and again in recent months. The prices have more than doubled in a year to nearly 140 U.S. dollars a barrel, triggering protests worldwide and concerns over its damage to world's economic growth and energy security.
Some oil consuming countries said the situation has largely resulted from supply shortage, and they have blamed OPEC for refusing a production increase.
In the United States, the world's top energy consumer, the lower house of parliament adopted a bill in May which authorizes the U.S. government to sue OPEC for controlling oil prices.
Saudi Arabia, under such a pressure, has to do something to show the world its determination to maintain stability at the oil market.
The country will do everything it can to bring "abnormally high" oil prices to "adequate levels," Saudi King Abdullah bin Abdul-Aziz told U.N. Secretary General Ban Ki-moon last week.
As its latest effort to show the world that the country is a responsible exporter, Saudi Minister of Petroleum and Mineral Resources Ali Bin Ibrahim al-N'aimi confirmed Friday that the kingdom will be pumping 9.7 million barrels per day (bpd) of crude in July, an increase of 550,000 bpd since May and the highest daily output since August 1981.
TO BOOST COOPERATION BETWEEN CONSUMERS, PRODUCERS
OPEC members, rejecting the accusations from the consuming countries, have blamed speculators for inflating oil's rally and adding volatility to the trade. They have demanded further regulation of future markets to give a blow to speculators.
They also attributed the price hike to the weaker dollar and escalating geopolitical tension rather than the imbalance between supply and demand.
The soaring prices for crude actually can not always be a blessing for those exporters, although they have earned great fortune from the business.
As some of the world's major economies, including the United States, Euro-zone countries and Japan, have seen a remarkable slowdown in their growth, the skyrocketing oil prices are likely to hinder their economic development and thus spread the sluggishness to the rest of the world due to the globalized economic regime.
If so, oil exporters, including Saudi Arabia, will also suffer.
From a long perspective, soaring oil prices will undoubtedly force the importers resort to alternative energy. When someday they become less dependent on crude oil, it will do no good to Saudi Arabia and its OPEC counterparts for a long run.
Saudi Arabia, which has a bigger say in OPEC, hopes that the Jeddah meeting could promote the dialogue and coordination between exporters and producers instead of blaming each other.
According to ArabNews, a Saudi local newspaper, the conference is expected to focus on how and to what extend speculators matter in the prices hike and how to curb their activities in crude trade.
TO CURB INFLATION, INCREASE INFLUENCE
Saudi Arabia's domestic situation also requires some actions.
As the world's prices for food and other resources also move upward boosted by the oil price hike, Saudi Arabia, which has to import everything except crude oil, has witnessed an inflation jump. In April, its inflation hit 10.5 percent, the highest in 27 years.
From the geopolitical perspective, Saudi Arabia, whose economic power has been accumulated amazingly in recent years due to the inflow of dollar earned in oil trade, wants to promote its influence at both regional and international arenas, and the upcoming energy meeting serves an opportunity to play its part.
Source:Xinhua
|
Comment
Tell A Friend
Print Format
Save Article