S.E. Asian officials worry about cuts in oil production

S.E. Asian officials worry about cuts in oil production

Associated Press Manila, Philippines

Thailand and the Philippines expressed concern on Wednesday over recent reductions in world oil production, warning that further cuts could slow global economic growth.

The two Southeast Asian countries said in a joint statement that they will push for creation of a regional petroleum hub to be used for stockpiling and distribution.

In addition, they said they "are moving toward strong bilateral cooperation that would allow us to diversify our sources of oil, as well as develop indigenous energy resources."

This could include cooperation in oil and gas exploration, geothermal drilling, solar energy and development of alternative power generation programs, such as the use of rice husks.

The statement came after talks between Thai Energy Minister Prommin Lertsuridej and his Philippine counterpart Vincent Perez.

"We are urging oil-producing countries to consider not to undertake more cuts in their oil production, as this would have serious implications on the economies of oil-importing countries and eventually slow down the growth of world economy," the officials said.

"The bilateral talks we are having today is one of the many concrete steps being undertaken to push for the optimized use of existing infrastructures to bolster energy security" in the 10- country Association of Southeast Asian Nations, along with China, Japan and Korea, the statement said.

Prommin was on a two-day trip to the Philippines with a delegation of investors that included Prasert Bunsumpun, president of Thailand's PTT PCL.

Prasert said his company plans to invest 2 billion to 3 billion pesos (US$36 million to $54 million) to expand its gasoline retail operations in the Philippines within five years.

PTT had considered selling its retail operations in the Philippines as recently as two years ago.

"The economic situation changed ... so we had to review our position," Prasert told Dow Jones Newswires.

Under the plan, PTT will expand its network of gasoline stations to 100 from around 40 currently.

Ten nations belonging to the Organization of Petroleum Exporting Counties( OPEC) agreed last week to curb their oil production by as much as 2.5 million barrels a day, or by nearly 10 percent. The move is expected to lead to higher prices for gasoline and other refined products worldwide