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Oil conundrum stumps G8

business Updated: Jul 08, 2008 20:25 IST
Rajesh Mahapatra
Rajesh Mahapatra
Hindustan Times
Oil conundrum stumps G8

Leaders of G8 countries — the world’s wealthiest economies — on Tuesday expressed “strong concerns about the sharp rise in oil prices,” but stayed short of recommending concrete measures to tide over the crisis.

On the second day of their meeting in the northern Japanese island of Hokkaido, the leaders reviewed the state of the world economy and said the recent surge in food and oil prices posed “a serious challenge to stable growth worldwide.”

“The world economy is now facing uncertainty and downside risks persist,” said a statement from the Group of Eight countries — the US, Britain, France, Germany, Japan, Canada, Italy and Russia.

Global crude prices have more than doubled in the past year to an all-time high of around $145 a barrel, putting pressure on finances of fast growing economies like India and China that depend much on imported oil. A similar surge in food prices has triggered a crisis in many African countries, pushing millions of people there back into poverty and hunger.

On Monday, Prime Minister Manmohan Singh slammed the developed countries and international financial institutions for not doing enough to put a lid on soaring global food and oil prices.

Singh proposed the creation of a forum of oil producers and consumers, an idea that appeared to have found support within the G8.

“To enhance energy security, we propose holding an energy forum to focus on energy efficiency and new technologies, which could also contribute to dialogue between producers and consumers,” the G8 statement said.