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PARIS: France called on the G7 on Tuesday to press oil-producing
nations to boost their output in a bid to bring down prices that
have reached record highs and thrown a spanner in oil-fired
economies.
Finance Minister Christine Lagarde said she
would put the request to her counterparts of the Group of Seven club
of rich countries to seek a common front with Britain, Canada,
Germany, Italy, Japan and the United States.
“We cannot forever be in a market system in
which the price is permanently on the rise, to the benefit of
producers, who are building up major oil revenues,” Lagarde told
France 2 television.
“I have decided to alert all of my G7
colleagues to discuss this issue, among consumer nations, and that
we present it to producing nations,” she said.
Lagarde said she would ask the G20 group of
emerging economies to join in the drive to bring down the price of
the barrel, that hit a record high of $135 last week.
France has been rocked by nearly three weeks of
protests by fishermen who have blocked ports, fuel depots and
marinas to press demands for government aid to help cushion soaring
fuel coasts.
While the protest movement appeared to be dying
off in France after the government released aid, fishing fleets in
Spain, Portugal, Italy and Greece launched action to press for
assistance.
Algeria’s Energy Minister and OPEC President
Chakib Khelil said earlier this month that falling production in
non-OPEC countries such as Russia had contributed to the spectacular
rise in global oil prices.
But the head of the Organization of Petroleum
Exporting Countries blamed the weakness of the dollar and other
factors for the rise, dismissing calls for a boost in production as
a solution.
“If OPEC decides to raise production . . .
these hikes will not really lower the price,” said Khelil in an
interview to Spanish radio on Monday.
President Nicolas Sarkozy said in a radio
interview that French consumers should brace for higher oil prices
and that France was committed to developing alternative energy
sources.
With France set to take over the presidency of
the European Union in July, Sarkozy said he wanted to discuss with
EU leaders the possibility of suspending the value-added tax on oil
imposed by European states.
“I want to ask the question to our European
partners: if oil continues to increase, should we not suspend the
VAT taxation on the price of oil,” Sarkozy said.
“The demand for oil products is getting
stronger and stronger and supply is not increasing or very
little,” said Sarkozy, who last week traveled to Angola,
sub-Saharan Africa’s second-biggest oil producer after Nigeria.
French consumers pay about 19.6-percent VAT on
the price of oil, which Sarkozy said had doubled since he took
office last year.
“The cost of living is high, the cost of
living is higher in France than elsewhere and there is no point in
denying this reality,” Sarkozy said.
-- AFP
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