Saudi Arabia's King Abdullah blamed speculators, high fuel taxes in consuming countries, and increased oil consumption in developing economies for recent oil price rises. But the kingdom's oil minister says Saudi Arabia is willing to produce more oil if customers need it. From London, Tendai Maphosa has more for VOA.
King Abdullah spoke at the opening of an oil summit he convened in Jeddah. He said Saudi Arabia, the world's largest oil exporter, has already said it is increasing its production to 9.7 million barrels a day.
Calling the swift rise in oil prices unjustified, he said speculators who play the market out of selfish interests, increased consumption by several developing economies, and additional taxes on oil in several consuming countries are to blame.
But U.S. Energy Secretary Samuel Bodman is quoted by the French news agency, AFP, as saying there is no evidence that speculators are driving futures prices. Bodman reportedly told the meeting that prices would keep on rising unless there is an increase in the supply of crude oil.
British Prime Minister Gordon Brown, who attended the meeting, proposed what he calls a win-win new deal between oil producers and consumers to prevent oil price shocks.
"I propose that Britain and other oil consumers should open our markets to new investment from oil producers, including sovereign wealth funds in all forms of energy, including renewables and nuclear; providing oil producers with a long-term future in non-oil energy," Mr. Brown said. "And in return, oil producers should be open to increased funding and expertise in oil exploration and development through cooperation with external investors providing increased supply in the medium term, while growing economies to adjust to a less oil intense long-term future."
Saudi Arabia increased oil production by 300,000 barrels a day in May. On Saturday it announced a further 200,000 barrels a day in July. But this has not stopped the price surge. The result is high pump prices and rising inflation.
But it does not look like fellow oil producing nations will follow Saudi Arabia's lead. AFP quotes OPEC president Chakib Khelil, who was at the summit, as saying the price hikes were not a problem of supply. He also blamed speculation and the currency market turbulence. Khelil said OPEC would only look into increasing production at its meeting in September.