Sky News business presenter Emma Crosby

The world’s great and good politics and the oil industry are dusting off their gas-guzzling stretch limos and heading into the desert heat of Jeddah this weekend to see what can be done about the ever-rising price of oil.

Saudi Arabia, the world’s number one oil producer and key figure within OPEC, called this unprecedented meeting. And about time too as political leaders are under fire from voters for not doing enough to curb price rises, while the oil giants and OPEC states are criticised for getting rich as the rest of us struggle to pay our fuel bills.

We can probably expect lots of hand wringing “we feel your pain”, and “high oil prices aren’t in the interest of OPEC states or the oil companies, honest”. Thanks for the sympathy but chat isn’t going to move the price of the black stuff.

What will cool the soaring cost of energy?

Well, prices in New York and London fell quite aggressively overnight on news that China is upping fuel prices by 18%, meaning demand there may fall as petrol and gas become too expensive for some.

So maybe it’s demand rather than supply which the market reacts to. How do we dampen demand? Keep oil prices so high it prices people out of the market? Bring in rationing? Find fuel alternatives or look for ways to change our lifestyle and reduce our dependency on oil?

One thing's for sure, the heat these guys feel in the desert will be nothing to the rising temperature of public outcry if they don’t come up with a radical solution soon.

Comments

[Clive.Cumbria 21 Jun 2008 13:22:59]

Hello Emma,you seem able to get results,so I hope you dont mind if I put a question to your readers.
We in the U.K live on billions of tons of coal...in South Africa they extract oil from the coal and use it for car fuel;China is also looking at it,but every time it is mentioned here it seems to hit a wall of silence...why is this,is it because its not 'Green',or because its not in some long term Goverment plan.

[Khalid 20 Jun 2008 15:15:09]

Good afternoon Emma.
Oil, whilst being the delight of many an account as well as the bain of society is such a slippery thing it just escapes through the nozzle and the next thing you know theres a lot of smoke.
Thus far as pricing, then it goes without saying that the revenue generated is put to (in many a case) towards the better of local development, however, if production is increased, it is natural that society will take it for granted and carry on as if nothing matters.
Thus far as matters pertaining the environment, then as many a ship has dropped anchor unexpectedly, we all know full well the damage caused, whilst no feasible penalty is imposed on the carrier but upon the end user.
On the other hand, countries where the oil is priced in pence per litre can further ease the burden upon OPEC and agree to a standard price ie 60p per litre everywhere, thereby no matter what everyone pays exactly the same, furthering the reach of these very limited resources.
I naturally congratulate Saudi Arabia for taking the stance insofar as the meeting of many a guzzler and put it to them straight that this is the [Summer Of Love-Lonyo Comme Ci Comme Ca].

[Jeremiah1974 20 Jun 2008 14:33:15]

I think this short term rise is a speculative bubble.

Sure, in the long term supply and demand take hold but this sharp increase happened in too short a time.

[Michael Cornwall 20 Jun 2008 14:30:57]

Nice article Emma. I was actually thinking after reading Michaels article on the big meal, that there they were telling us all off again and threatening us with possible interest rate rises because of inflation. Isn't the root of inflation oil? why not do what you write about put pressure on Saudi, apparantly they are increasing production in July. A simple solution would be do knock off some tax on it and that brings down inflation. I run a shop so I may be wrong...
Jacqui Treweek who runs a funky hair salon in Falmouth, called Kids and Us.
She tells me that the economic slowdown has hit her as the vast majority of her customers have changed from having their hair cut every 6 weeks instead of every 4 weeks. A small ammount but it all hurts. She also told me that the retailers in Falmouth are meeting and planning to stay open 1 evening a week starting next week to try to get a bit more trade and money. I get the feeling that Darling or someone will frown on it, call it infationary , But we are all fighting back,simply because that is what we do.