John Busby, Energy Analyst of G-8 Forum, Saturday [30/5] informed Business News on the result of the Energy Minister of the G-8 Meeting which called for a joint strategic step to free the world from desperate dependency on energy resources, especially crude oil [fossil fuel]. “The worlds saw the price of oil had soared through around USD 147 per barrel in June 2008. The result : nearly all of the pillars of the world’s system crumbled down. Prices of food skyrocketed flaring widespread fear of a global food crisis. Such condition should never happen again in the future. Our responsibility for the next generation should be pondered from now on”.
Members of the G-8 were Canada, France, Germany, Italy, Japan, Russia, England and the USA. According to IMF data the skyrocketing oil price had driven prices of all commodities in the world to a fearful level.
“An unusual trend, where oil price broke through the USD 147 per barrel was definitely a nightmarish experience which should never happen again in the future. If oil producing states might arrive a t a consensus to set a price at reasonable level, probably at the range of USD 70 to USD 80 per barrel, it would be tolerable to the world. But to be above USD 100 per barrel, learning from experience, or more over USD 147 per barrel would force the world to turn to alternative energies as solutions”.
Graphics showed that the trend of increase in fuel could drag prices of other commodities. The most worrying was the price of food which might trigger food crisis in many poor countries.
“Research in technology to invent alternative energy all over the world had made remarkable achievements but has not reached the favourable economic value comparable to the fossil fuel which were relatively still ‘cheap’. But if a nation like Brazil managed to escape from dependency on crude oil why could not other nations which had equal agricultural strength do the same? Probably the reason was lack of fund to develop biofuel. So the G-8 agreed to find ways to find the fund to develop alternative energy. It was also agreed to extract biofuel not from the kind of plantations for human food or animal feed. A global commitment was needed for this led by G-8 as pioneer. If only G-8 could step up the use of biofuel significantly, automatically the bargaining position of crude oil would no longer be as strong, hence oil price could be stabilized”.