Pacific Rim officials discuss oil prices, supply

Pacific Rim officials discuss oil prices, supply

Associated Press, Gyeongju, South Korea

Pacific Rim energy officials on Tuesday began discussing the impact of soaring oil prices, energy security and alternative sources of fuel a day before Cabinet ministers from the region hold their first ever talks with OPEC officials.

Senior officials from the 21-member Asia-Pacific Economic Cooperation forum, which includes energy producing nations Canada, China, Indonesia, Mexico, Russia and the United States as well as resource-poor economies like Japan and South Korea, are here to prepare for the 7th APEC Energy Ministers' Meeting in the southeastern Korean city of Gyeongju.

APEC's economies account for about 60 percent of global energy consumption and import 77.2 percent of the crude oil produced by OPEC, according to Bong-hyeon Joo, director general at the energy and resources policy bureau of South Korea's Ministry of Commerce, Industry and Energy.

Imbalances as well as alternative energy resources were likely to be topics, said senior officials, who were finalizing a joint statement to be issued by the energy ministers at their meeting.

"How can we keep the energy supply stable? How can we stabilize supply and demand," Joo said regarding the key issues to be addressed.

The energy meeting is usually held every two years, but because of surging oil prices member economies have scheduled one for this year even after a 2004 meeting in Manila. However, many APEC members, including Japan and the United States, are sending deputies to stand in for their energy ministers.

The gathering marks the first time that officials from OPEC will attend.

Adnan Shihab-Eldin, OPEC's acting secretary-general, will give a speech on Wednesday, and the meeting that day will include what is billed as a business dialogue between OPEC and APEC members.

Surging oil prices, which rose above US$70 a barrel in late August, have caused worries about their possible drag on global growth.

Prices have since pulled back though concerns remain about the pace of recovery following hurricanes Katrina and Rita in the United States and whether supplies will be adequate going into the Northern Hemisphere winter, when demand for heating oil peaks.

"The possibility of making use of alternative energy like bio- fuels" such as ethanol was also likely to be considered, said Boonrod Sajjakulnukit, an official at Thailand's Energy Ministry.

APEC finance officials at a meeting last month said sustained high energy prices are a risk to economic growth in the region and called for more investment in oil production and refining capacity, stepped up conservation efforts and the development of renewable energy sources.

At that time, finance ministers or their deputies and the heads of the International Monetary Fund and Asian Development Bank discussed oil and energy issues at a two-day meeting on South Korea's southern Jeju Island.

APEC, launched in 1989, has set as its main goal boosting trade among its members, with the ultimate aim of establishing a free trade area by 2020. In recent years it has expanded its scope to include discussions of issues such as corruption and combating terrorism.