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Brown vows to throw open energy markets

Jeddah, June 22, 2008

Prime Minister Gordon Brown pledged on Sunday to open Britain's energy markets to foreign investors in a 'new deal' designed to promote clean energy and end a conflict of interest between oil producers and consumers.

At an emergency oil summit in Jeddah, Brown unveiled plans to work with Saudi Arabia on technology to capture carbon emissions from energy plants and with the UAE nuclear technology.

He told reporters that Britain and Qatar were looking at a new joint energy fund to invest in British energy industries, and that talks with the Abu Dhabi Investment Authority about investment opportunities in Britain were moving forward.

'We want them to invest in alternative sources of energy in our economies, just as we want them to allow our efficient oil companies to have a role to play in the oil production of the oil producing countries,' Brown said.

He said earlier this year that Britain was open to investment from the huge sovereign wealth funds run by rich oil producers. Little concrete has been announced, however, and he did not elaborate on plans forged with the Gulf states, except to make clear nuclear energy and renewables were the focus for Britain.

'The new deal is that everybody has an interest in a more stable energy market, everybody has an interest in there being alternatives to oil, everybody has an interest in there being a better and more efficient use of oil,' Brown said.

Brown pointed out that the world's top oil producers and consumers now agree that oil prices hovering near a $140 a barrel record were too high, thus signalling a change of heart by producers.

'What we've got here is agreement that the oil price is too high,' Brown told a briefing on the sidelines of emergency talks in Jeddah.

'The significance is that the producers are saying this, that the current oil price is detrimental and that it is causing serious damage, that the current price is too high.'    
Like some other leaders of developed nations, Brown's popularity has taken a hit as voters grapple with a slowing economy, a squeeze on bank lending, falling house prices and accelerating inflation - driven by fuel and food prices.

The oil price has more than doubled in a year to almost $140 a barrel, triggering protests from Brussels to Bangkok over record fuel costs that threaten the world's economy.

Britain is also striving to meet targets to cut greenhouse gas emissions. It reckons it will need investment of up to 100 billion pounds in renewable energy to meet those goals, and the government sees sovereign wealth funds as a valuable source.

On Saturday, Britain's Energy Minister Malcolm Wicks said the government would unveil a 'green revolution' next week which aims at getting 15 percent of the country's energy from renewables by 2020 - up from less than five percent now.

Britain's prime minister argues that unless there is a better understanding of the global problems of supply and demand, there is little chance of affecting today's oil price.

He says consumers must lessen their dependency on oil by using other energy sources, such as renewables and nuclear power, and by using energy more efficiently.-Reuters




Tags: Brown | open | energy market | overseas investors |

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