By Ben Perry (AFP) – Mar 31, 2010
CANCUN, Mexico — World energy producers and consumers pledged greater cooperation and called for transparent markets here on Wednesday to tackle oil price volatility seen as damaging to economic recovery.
"With regard to energy market volatility, energy markets should be as transparent as possible," said a joint declaration issued by the International Energy Forum at the end of a two-day meeting in the beach resort of Cancun.
It also agreed to strengthen dialogue between leading oil producers, such as Saudi Arabia and Russia, and key consumers including the United States and China -- in a bid to eliminate the risk of excessive price volatility.
Oil prices surged to all-time peaks of above 147 dollars a barrel in July 2008, before the severe global economic downturn saw them crashing to just 32 dollars.
They have steadily recovered, trading in recent months mostly between 70 and 80 dollars -- a level deemed acceptable by producers and consumers.
However the price of crude surged close to 84 dollars on Wednesday, hitting the highest level since October 2008 in response to the falling dollar and weaker-than-expected US jobs data, traders said.
In Cancun meanwhile, the ministerial declaration "decided to strengthen consumer-producer dialogue... for reducing the volatility in energy markets," Saudi Arabia's oil minister Ali al-Nuaimi told a press conference.
British junior energy minister Philip Hunt also attending the biennial IEF -- the world's biggest forum for energy ministers -- said "oil price volatility has very negative consequences for the world as a whole".
He added on Wednesday: "We need stable and efficient energy markets. We need them both in terms of ensuring future investment and development.
"But we also need them in helping the globe as a whole recover from the financial problems that we've seen in the last two years. That's why I believe this declaration is so important," said Hunt.
The Organization of Petroleum Exporting Countries -- whose member nations together pump about 40 percent of the world's oil -- blames speculators for pushing crude futures to record highs nearly two years ago.
As well as OPEC and non-OPEC producers, the IEF was attended by the International Energy Agency, a body representing consumers as the energy-monitoring arm of the OECD grouping of the world's 30 leading industrialized nations.
IEA head Nobuo Tanaka told AFP in Cancun that while speculators played a role in creating excessive oil price volatility, major energy consumers such as China did not help matters by failing to provide transparent data on their oil stockpiles.
The IEF began the process of improving inventory and energy demand data in 2001 with the launch of the Joint Oil Data Initiative (JODI), whose member organizations include OPEC, the IEA and Asia-Pacific's top economic club APEC.
In its declaration on Wednesday, the forum pledged to improve the work done by JODI. The IEF also proposed creating its own charter that would help to improve its transparency and dialogue and ultimately its influence on the world stage.
The IEF has also used this week's gathering to mull the outlook for renewable energy sources such as biofuels.
As it wrapped up proceedings on Wednesday, US President Barack Obama announced plans to open some offshore waters to oil drilling.
Obama said that in order to wean the United States off sources of foreign oil, the world's biggest energy consumer had to fully exploit some of its own untapped resources, even as it seeks to develop new forms of energy.
The latest IEF set out to build on the last forum in Rome in 2008 and two ad hoc meetings in Jeddah and London later that year when oil prices endured their roller-coaster ride.
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