Business | Oil & Gas
High oil prices cut refinery investment, says Al Hamili
Record high international oil prices are part of the reason for the reluctance of industrial countries to invest in refineries, a top UAE official said on Monday.
- By Ahmed A. Elewa, Senior Reporter
- Published: 20:55 June 16, 2008
Abu Dhabi: Record high international oil prices are part of the reason for the reluctance of industrial countries to invest in refineries, a top UAE official said on Monday.
Saudi Arabia is hosting an international meeting on June 22 in which major energy producing and consuming countries will meet to address the issue of rising energy prices.
"There are not enough refineries to meet growing demand," Mohammad Bin Dha'en Al Hamili, UAE minister of energy, told Gulf News on Monday.
The remarks came on the sidelines of a meeting in the capital with UK Energy Minister Malcolm Wicks, who was visiting the UAE after meeting officials in Riyadh where the Saudis said they would increase production by 200,000 barrels per day.
"A shortage of refineries is one of the main reasons behind the increasing prices as a result of the policies adopted by industrial nations not to invest in new refineries due to environmental concerns, while the sector needs substantial new investments," Al Hamili said.
The US has not established any new refineries for more than two decades, while global oil demand is expected to grow by 12.7 million barrels per day, or 15 per cent by the year 2015, according to a report by the British Treasury.
"We would welcome the decision by any producing country with extra capacity to increase production, yet this decision lies in the hands of these countries, not for us to decide," Wicks said. "The reason for my visit is to discuss the issue and the likely agenda of Jeddah's meeting." He attributed rising prices to the growing demand from emerging markets, speculation and developments in financial markets.
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