Top energy officials from major oil importers, including the United States, Japan, the Republic of Korea and India met in Beijing Monday with their Chinese counterparts to explore ideas about restraining and stabilizing crude oil prices.
"The five giant oil consumers are turning from competitors into cooperators," said Li Xiaogang with the Foreign Investment Research Institute of the Shanghai Academy of Social Sciences.
"If they could team up to balance OPEC, the world's crude oil market would fluctuate less," Lin Boqiang, director of the China Energy Research Institute at Xiamen University, told China Business on Monday.
The move came after the Organization of Petroleum Exporting Countries agreed to scale back daily oil output by a million barrels, the first such reduction in two years.
Expert Guan Qingyou with the China Academy of Social Sciences predicted that the five countries might counter price fluctuations by striking a price negotiation agreement. A consensus could also be sought on crude oil transportation, added Guan.
Providing nearly one-third of the world's annual oil output, OPEC wields the largest influence in oil pricing. The official prices set by OPEC and the prices of crude futures at the New York Merchandise Exchange are often viewed as the barometer of oil pricing.
China, the United States, Japan, the Republic of Korea and India consume nearly 45.5 percent of the world's 3.77 billion tons of oil. Consequently, oil price hikes have impaired economic development.
To remedy the situation, the five major consumers have begun to cooperate.
Karen A Harbert, Assistant Minister of the U.S Energy Department, said last month in Beijing that China and the United States should join hands to promote energy efficiency and develop renewable resources.
Around 20 oil projects with a combined US$5 billion investment are being jointly developed in China by the two sides.
Japan and India are also interested in cooperation. For example, Sinopec and India's Oil and Natural Gas Corporation have teamed up to acquire a 50 percent stake in a Colombian oil company at a cost of US$800 million.
"When cooperation among the five nations materializes, crude oil prices might fall. The bottom line of US$55 per barrel set by OPEC might not hold," said professor Dong Xiucheng with China University of Petroleum.
(Xinhua News Agency October 24, 2006)