JDV seeks cap on soaring oil prices

Pangasinan Rep. Jose de Venecia Jr. proposed yesterday that the world’s oil producers put a “cap on soaring oil prices.”

He made the proposal at the two-day Asian Integrated Energy Market Forum organized in Moscow, Russia by the Asian Parliamentary Assembly (APA), of which the former Speaker is one of its founders.

The forum was led by Valeriy Yasev, vice president of the Russian Parliament and one of Russia’s oil experts.

“The danger is real that high oil prices could cause overburdened economies to collapse, setting off a series of debt service defaults that could trigger a global financial crisis,” De Venecia said.

He said the six oil-rich states of the Gulf Cooperation Council (GCC) should consider putting a cap on oil prices as a “gesture of solidarity” with poor countries of Asia, Africa and Latin America.

The council is made up of Saudi Arabia, Bahrain, Kuwait, Oman, Qatar, and the United Arab Emirates.

The prices of crude have soared to as high as $128 per barrel. This has prompted local oil companies to increase pump prices every week. They have added P2 per liter for the past two weeks.

De Venecia urged GCC states to “recycle part of their windfall profits” for an agricultural fund to significantly increase rice and wheat production.

“The GCC states might also be persuaded to put together a long-term agricultural loan fund from which the poorest Asian states could draw to keep up their agricultural production during this period of food scarcity that climate change seems to be generating,” he said.

He said such a gesture from GCC states should be widely appreciated by the poorest member-states of APA.

He described the Moscow forum as a “practical step in economic cooperation of self-evident usefulness that advances our dream of Asian integration.”

He said there are excellent prospects for energy complementation among Asian regions.

“Both East and Southeast Asia have modern industrial facilities but they are both energy-deficit regions. But West and North Asia can more than meet this lack because they have strategic deposits of oil and gas,” he said.

De Venecia noted that while Asia has free-trade areas and security alliances, there is “no structure for coordinating energy policy.”

“There is a need to unify national policies not just on energy trade but on developing resources, setting production levels, building cross-border pipelines, and safeguarding sea lanes of communication, energy conservation and environmental concerns,” he said.