Business | Oil & Gas

Oil summit calls for transparency

The summit, convened to address rocketing oil prices, called for greater transparency and regulation in dealing and more investment in production.

  • Agencies
  • Published: 23:54 June 22, 2008
  • Gulf News

  • Saudi King Abdullah Bin Abul Aziz addressing the opening session of the summit. King Abdullah opened the meeting by saying his country had boosted output to 9.7 million per day in a bid to defuse the energy crisis.
  • Image Credit: Reuters
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Jeddah: The summit, convened to address rocketing oil prices, on Sunday called for greater transparency and regulation in dealing and more investment in production.

The summit's final communique came amid accusations by oil producers that "speculators" are playing a key role in the dramatic rise in crude prices that earlier this month hit a record close to $140 per barrel.

"Participants noted with concern that oil prices have risen sharply and become more hostile due to a host of factors," said the closing statement.

"Participants agreed that the situation requires concerted efforts from all parties - producing and consuming countries - to bring stability to the international oil market for the benefit of all," it added.

Leaders and ministers from the 36 nations agreed to recognise that "the transparency and regulation of financial markets should be improved through measures to capture more data on index fund activity and to examine cross-exchange interactions in the crude market."

The statement also appealed for increased investment in crude production to ensure markets have sufficient supplies.

Saudi Arabia's increased production opened divisions within Opec at the summit.

Saudi King Abdullah Bin Abdul Aziz announced at the summit that his country is now churning out 9.7 million barrels a day. In support of the Saudi move, Kuwaiti Oil Minister Mohammad Al Olaim told reporters: "Opec will not hesitate to make any increase in production if the market required that ... for Kuwait, we will not hesitate to increase production if the market requires it."

But Opec President Chakib Khalil opposed increased production. Khalil, also Algeria's oil minister, said the talks are unlikely to ease record oil prices. "We believe that the market is in equilibrium. The price is disconnected from fundamentals. It is not a problem of supply," Khalil added.

He refused to answer questions about increased Saudi output, and other ministers dismissed the need for the summit.

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