The Media Line Staff
Saudi Arabia's proposal that the country be compensated for loss of income as oil-consuming countries are turning to other forms of energy, is gaining support among fellow oil producers.
Saudi Arabia, the world's top oil producer with an estimated daily production of ten million barrels a day, is asking that it be compensated for predicted loss of income as more and more countries are turning away from oil towards renewable sources of energy.
The call comes ahead of the United Nations Climate Change Conference that will be held in the Danish capital of Copenhagen in the beginning of December.
"The call by Saudi Arabia for compensation is anachronistic," Martin Kaiser, Coordinator for climate politics with Greenpeace International, told The Media Line.
One barrel of oil is currently trading at $75.
"A country which has economically benefited big time from fuelling global warming must not ask for compensation. The opposite, Greenpeace calls on Saudi Arabia to join those developed countries which have to agree to dual obligations in Copenhagen," Kaiser said.
"First to mitigate jointly by at least 40% CO2 emission from the 1990 level and second to provide predictable public financing to developing countries of about $140 billion annually by 2020," Kaiser said.
The Saudi position has been around since the United Nations started to hold talks on the changing climate in Rio de Janeiro in 1992. However this time they are gaining support from fellow oil producing countries such as Qatar.
The Qatari Minister of Energy and Industry, Abdullah al Attiyah, was quoted as saying "If the world is asking us to make a huge investment and they are asking to put in new capacity, we want to be sure that somebody will take this new capacity."
According to a recent study by the International Energy Agency, oil producing countries stand to lose an estimated 16% of their oil income as oil consuming countries increase their usage of Clean technology.
The main problem for Saudi, as well as the other oil producing countries in the Gulf is that despite efforts to diversify their economy away from a dependence on oil and gas, natural resources still remain the dominant source of income.
The current price of oil at $75 a barrel compares favorably with the estimated price of $60 a barrel, used as a gauge by Saudi Arabia and other member states of the Organizations of the Oil Producing Countries (OPEC) to calculate their budgets. The effect of a falling oil income could clearly be seen during the first half of 2009 when prices fell as low as $33 a barrel, compared to $147 a barrel the previous year. Local newspapers were full of announcements of various development projects being either canceled or put on hold.
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