Brown calls oil producers to invest in nuclear

Monday, 23 June 2008

UK prime minister Gordon Brown thinks oil producing countries could stabilise their market and secure long-term futures by investing in alternatives, including nuclear – and has told OPEC leaders he will open up the UK's energy industry to such investments.

 

Gordon Brown, King Abdullah and a friend

Speaking at an international summit on the current situation of the world oil market held in Jeddah, Saudi Arabia, Brown proposed his "new way forward" as a route to address the third oil shock in as many decades. He said that his proposals would lead to a better functioning, more stable oil market through clearer signalling of current and future supply and demand from both oil producers and consumers. There would also be commitments from producers to increase supply and investment, matched by a commitment from consumers to improve energy efficiency.

 

World oil producers   should "hedge their future    production by investing in   the alternative energy   sources that will be the   bedrock of future low   carbon economies"

Demand for oil would remain strong over the medium term even in the face of proposed climate change measures, he noted. Rising demand for energy could in part be reduced by more efficient energy use plus the use of "alternative sources including nuclear and renewables," but this must be achieved in a way that would benefit both oil producers and consumers. He proposed that oil consumers should open their markets to new investments from oil producers in all forms of energy including renewables and nuclear, and in return oil producers should be open to increasing funding and expertise in oil development. This, he said, would provide increased oil supply in the medium term while growing economies adjust to a less oil-intense future in the longer term.

 

An interest in a diverse range of non-oil energy sources would give oil producers the chance to "hedge their future production by investing in the alternative energy sources that will be the bedrock of future low carbon economies," said Brown. Abu Dhabi and Qatar are both already involved in discussions on possible energy investments in Britain and the UK has already agreed to work with the United Arab Emirates on nuclear energy opportunities, he noted. "Our commitment to the biggest expansion of nuclear power in Europe is now clear and definitive," he told delegates, adding that 15 of the 27 countries in Europe are now engaged in nuclear power.

 

Massive efforts needed

 

A joint communiqué released at the end of the Jeddah summit by Kingdom of Saudi Arabia, the International Atomic Energy Agency, the International Energy Forum and the Organisation of Petroleum Exporting Countries (OPEC) agreed that all oil producing and consuming countries, oil industry sectors and other involved parties must make "massive efforts" to achieve stability in the world oil market, which would benefit everyone. Among other things, the statement called for increased work on oil market analysis and forecasting, and recognised "the need to promote energy efficiency in all sectors." A follow-up meeting is to be held in London before the end of 2008.

 

Some Middle Eastern states, including Saudi Arabia, have recently made moves towards establishing their own nuclear power sectors. In February 2007, the six member states of the Gulf Cooperation Council – Kuwait, Saudi Arabia, Bahrain, the United Arab Emirates (UAE), Qatar and Oman – agreed to cooperate with the IAEA on a feasibility study on a possible regional nuclear power and desalination program. The USA has bilateral nuclear energy cooperation agreements with Saudi Arabia, Bahrain and the UAE. The UAE has also signed cooperation agreements on nuclear power with the UK and France.