The world’s largest energy forum begins meetings on Monday over oil price fluctuations and safeguarding supplies amid heightened tensions over Iran’s nuclear programme and a softening in global growth.
Oil ministers and delegates from the 88-member International Energy Forum (IEF) are holding their biennial three-day gathering in the Gulf emirate of Kuwait to discuss the role of the forum in tackling market volatility.
Ministers will discuss “energy market fluctuations and the role of the International Energy Forum and its member states in dealing with them,” according to a statement by the organisers.
They will also discuss “the long-term demand for energy, safeguarding supplies and drawing of appropriate policies for ensuring energy supplies,” it said.
Kuwaiti oil minister Hani Hussein said the meeting is held in “extraordinary circumstances,” citing Iran’s recent threats to block the Strait of Hormuz — through which most of Gulf oil shipments is exported, and the eurozone crisis, as causes of concerns.
“The threats regarding the Strait of Hormuz, as well as the eurozone crisis, speculators and price increases are making the situation more complex,” he said in a television interview on Sunday, according to KUNA state news agency.
Iranian officials had in January warned they could close the strait if increased Western sanctions over Tehran’s controversial nuclear programme halt Iranian oil exports, triggering further US security measures in the strategic transit route.
On Tuesday EU foreign affairs chief Catherine Ashton said on behalf Britain, China, France, Russia, the United States and Germany that they were ready to hold talks with Iran.
Last week, the OPEC oil cartel trimmed its 2012 global oil demand growth forecast for the second time in two months because of worries about developed countries’ economies and higher crude prices.
The Organisation of Petroleum Exporting Countries (OPEC) blamed a weak growth in the OECD economies, mainly the situation in Europe, in addition to high oil prices, for the expected ease in demand.
It also pointed to tensions between Iran and the West and speculation about Israeli military action against Tehran.
The 12-member cartel, which accounts for about 30 percent of global crude oil output, now expects daily demand this year of 88.63 million barrels per day, down from its forecast a month ago of 88.76 million bpd, it said in its March monthly report.
This still represents growth compared to 2011, when demand was 87.77 million bpd, according to OPEC figures that were revised slightly downwards.
Oil prices remained over $100 per barrel for all of 2011, after tumbling from almost $150 in 2008 to nearly $30 during the global financial crisis in 2009.
On March 1, West Texas Intermediate crude hit $110.5 per barrel, the highest since May 2011, while Brent North Sea crude rocketed to $128.4 a barrel, the highest since July 2009.