13 Asian Countries Agree on Coordinated Response to Oil Supply Emergency

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Last updated at: (Beijing Time) Monday, September 23, 2002

13 Asian Countries Agree on Coordinated Response to Oil Supply Emergency

Energy ministers from 13 Asian countries agreed Sunday to set up an information-sharing network to open the way for a coordinated response to oil supply emergencies, Japan's Kyodo News reported.

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Energy ministers from 13 Asian countries agreed Sunday to set up an information-sharing network to open the way for a coordinated response to oil supply emergencies, Japan's Kyodo News reported.

The ministers from Japan, South Korea, China and the Association of Southeast Asian Nations (ASEAN) reached the agreement at a working lunch on the sidelines of the ongoing eighth International Energy Forum in the Japanese city of Osaka.

"Information sharing through this network will open the way for a coordinated response, contributing to the stability of the regional energy market," said a joint statement outlining the five-point agreement.

But the ministers stopped short of discussing whether their countries should exchange oil reserves in case of supply shortfalls, Kyodo said.

It was the first time the energy ministers from the 13 Asian nations had gathered.

The ministers also agreed to prepare a set of emergency response measures that may include release of stockpiles and consumption restraint, and on the need to develop oil stockpiles, both through obliging the private sector to build and maintain a certain amount of reserves and creating national strategic stocks.

"As Asia is expected to account 45 percent of world oil demand growth in 2020 (over the current levels), developing our emergency response capacity will be critical," the statement said.

Of the 13 Asian nations, only Japan and South Korea have national oil stockpiles in addition to legally required private-sector reserves, which are held also by Thailand, an ASEAN member, according to Kyodo.

The 13 ministers also agreed to jointly study the Asian oil market to solve the problem of the so-called "Asia premium," which puts crude prices up to 2 dollars a barrel higher than those on oil delivered to the United States and Europe, attributed in part to defects in the pricing mechanism.

The remaining two initiatives they adopted are cooperation for a greater use of the abundant reserves of natural gas in Asia, being found in relatively small gas fields, and for a clean and efficient use of energy.

Delegates from 65 energy-producing and -consuming nations plus 10 international organizations are taking part in the forum, which opened on Saturday.

The three-day forum is the largest in size and the first held in East Asia since it began in 1991.

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