Asia-Pacific nations urged to help curb oil prices

Asia-Pacific nations urged to help curb oil prices

BANGKOK, Thailand (AP): Thailand has urged a powerful group of
Asia-Pacific nations to pressure oil exporting countries into
reducing the high crude prices before "it leads to another
economic crisis."

In a letter dated Thursday to the foreign ministers of the 21-
member Asia Pacific Economic Cooperation forum, Foreign Minister
Surin Pitsuwan said his government is "very concerned about the
adverse impact of high oil prices on the global economy."

A copy of the letter was distributed to news agencies Friday.

Earlier this week, oil prices surged to their highest levels
since the 1991 Gulf War with traders blaming low U.S. inventories
of crude and concerns that the world's largest producer, Saudi
Arabia, has curbed production. Crude is now being traded around
US$32 a barrel.

Surin said APEC should consider conveying collectively "a
strong and unified message to the international community,
particularly the oil exporting countries" about the adverse
impact of the high prices on the recovery of the East Asian
economies.
T he problem should be dealt with "before it gets out of hand
and leads to another economic crisis," Surin wrote.

He sent a similar letter to the foreign ministers of the
Association of Southeast Asian Nations, a 10-nation group that
includes Thailand. Another letter was sent to the foreign
ministers of Indian Ocean rim countries.

Most ASEAN members are part of APEC, which is made up of the
United States, Indonesia, Japan, South Korea, China, Australia,
New Zealand, Brunei, Canada, Chile, Hong Kong, Malaysia, Mexico,
Papua New Guinea, Peru, the Philippines, Russia, Singapore,
Taiwan, Thailand and Vietnam.

Thailand and other Asian countries are just recovering from a
severe economic crisis in 1997 that saw foreign investments dry
up, economies shrink and local currencies depreciate drastically.

In his letter, Surin said the high oil price could "seriously
hinder, and possibly reverse, the economic recovery in Asia and
other parts of the world, thus posing a serious threat to global
economic stability."

Thailand recently increased gasoline prices twice this month
and beginning in September will scrap subsidies given to
industries for liquefied petroleum gas.

Despite these measures, it expects its Oil Fund to be
completely depleted by the end of the year. The Oil Fund is used
to maintain retail petroleum prices at a steady level and to
subsidize LPG prices.