Top energy officials from major oil importers, including the
United States, Japan, the Republic of Korea and India met in
Beijing Monday with their Chinese counterparts to explore ideas
about restraining and stabilizing crude oil prices.
"The five giant oil consumers are turning from competitors into
cooperators," said Li Xiaogang with the Foreign Investment Research
Institute of the Shanghai Academy of Social Sciences.
"If they could team up to balance OPEC, the world's crude oil
market would fluctuate less," Lin Boqiang, director of the China
Energy Research Institute at Xiamen University, told China Business
on Monday.
The move came after the Organization of Petroleum Exporting
Countries agreed to scale back daily oil output by a million
barrels, the first such reduction in two years.
Expert Guan Qingyou with the China Academy of Social Sciences
predicted that the five countries might counter price fluctuations
by striking a price negotiation agreement. A consensus could also
be sought on crude oil transportation, added Guan.
Providing nearly one-third of the world's annual oil output,
OPEC wields the largest influence in oil pricing. The official
prices set by OPEC and the prices of crude futures at the New York
Merchandise Exchange are often viewed as the barometer of oil
pricing.
China, the United States, Japan, the Republic of Korea and India
consume nearly 45.5 percent of the world's 3.77 billion tons of
oil. Consequently, oil price hikes have impaired economic
development.
To remedy the situation, the five major consumers have begun to
cooperate.
Karen A Harbert, Assistant Minister of the U.S Energy
Department, said last month in Beijing that China and the United
States should join hands to promote energy efficiency and develop
renewable resources.
Around 20 oil projects with a combined US$5 billion investment
are being jointly developed in China by the two sides.
Japan and India are also interested in cooperation. For example,
Sinopec and India's Oil and Natural Gas Corporation have teamed up
to acquire a 50 percent stake in a Colombian oil company at a cost
of US$800 million.
"When cooperation among the five nations materializes, crude oil
prices might fall. The bottom line of US$55 per barrel set by OPEC
might not hold," said professor Dong Xiucheng with China University
of Petroleum.
(Xinhua News Agency October 24, 2006)