On oil prices

OPEC is threatening to cut oil production to avoid prices falling further. The consequences of the threat were already felt at the end of last week when prices went up by four percent in a single day.

OPEC in recent years seldom obtained full cohesion among members. In periods of high prices, many producing countries broke their quotas, lured by increased profits. In periods of low prices, they also broke quotas because oil is their main source of revenue.

This time, the Saudi Oil minister Ali Al-Naimi says that in order to avoid a collapse in prices, his country is ready even to lose part of its international market share. To a certain extent this is a worrying statement, because Saudi Arabia is a leading oil exporting nation. Besides, the impact of the Middle East and Asian armed conflicts on the price of this commodity is not negligible.

It is unlikely in the short term that oil prices will upset the Brazilian economy. But it is convenient for the country to keep investing in search of alternate energy sources. It seems clear that efficient use of oil is not enough to avoid, in the long term, problems affecting the supply and demand of oil.

-- Folha de Sao Paulo, Brazil