Pacific Rim Officials Worried About Energy

Philippine Energy Secretary Vincent Perez closed a meeting of the 21 Asia-Pacific Economic Cooperation economies by suggesting that solutions could include more oil stockpiles, better emergency planning, conservation, better regional cooperation and alternate energy sources.

"There's an imbalance in the fact that our demand is going up faster than supply in the long run, and this is a major policy concern for us," Perez said.

High oil prices that peaked at above $42 per barrel earlier this month in New York have harmed regional economies and created worries in consuming nations about creating better energy security.

Perez said Asian nations that attributed the 1997 financial collapse to runaway currency speculation now believe they are suffering at the hands of speculative oil traders who have pushed the price higher than supply and demand would dictate.

They discussed taking some action during the recent one-day APEC meeting, but Perez acknowledged no specific proposals were made. Oil traders have in the past come under fire from consumers when prices rise, and from producers when prices fall.

APEC's energy demands are projected to rise by 2.1 percent annually through 2020, with expanding economies and booming populations consuming more oil and electricity -- creating demand that could push prices higher without proper planning by regional leaders.

APEC's growing thirst for oil is projected to increase the region's crude imports, largely from the volatile Middle East, to 55 percent of total consumption compared to the current 36 percent, officials said in a summary of the "energy outlook and security issues."

APEC economies, including the United States and countries on both sides of the Pacific Ocean, will need to spend $3.4 trillion to $4.4 trillion on new energy infrastructure, the summary said.

OPEC agreed last week to increase output. Oil prices then quickly retreated several dollars per barrel on the New York futures market, taking some of the pressure off consumers. But Pacific Rim energy officials say they'll set up contingency plans -- details were vague -- for dealing with any supply shortages, including those caused by terror attacks or political instability.

Oil supplies also must be secured against natural disasters, piracy in shipping lanes and system failures, according to a statement released by the APEC ministers. Pipelines, ports, transmission hubs and other energy facilities also could be at risk, it said.

Officials from the 10 members of the Association of Southeast Asian Nations discussed energy security here Wednesday with dialogue partners from big Asian economies China, Japan and South Korea.

They closed with a statement suggesting a variety of strategies, including more stockpiling of oil, while complaining about the so-called ``Asian premium'' that keeps crude more than $1 per barrel higher in this region than it is in the United States and Europe.

Asian nations that believe they are being gouged want to discuss it with OPEC, officials here said, but no meeting has been set.

The APEC statement welcomed "efforts by oil producers to provide adequate supply to help stabilize the market" but noted other factors contribute to the price.