Islamabad: Era of cheap oil is over forever and economies of whole world are reeling due to unprecedented oil prices rocketing out of sight. The crunch can be taken as a wake-up call in the oil consuming countries to be united for the future of humankind.
Energy crisis has shaken the whole world and it has become major concern as estimates suggest that oil process will never come down again until some big breakthrough is achieved. The oil prices have accelerated food prices that are direct threat to the poor. 40 percent of South Asia’s 1.4 billion people live on less than $1 a day who should be saved.
Social assistance programs that directly targets poor households should be expanded to protect poor in the face of a dramatic increase in prices, safety nets should be enlarged. Around 1.6 billion people in the developing world have no access to electricity and it seems that load shedding will soon become part of the life in developed world. Energy needs would be 50 percent higher by 2030.
On the other hand, the Opec (Organization of Petroleum Exporting Countries) has only 13 members which deals only with oil from the producers perspective. Usually, the controversial political actions of west drive the prices south that include Arab-Israel conflict, Persian Gulf crisis, invasions and occupation of Iraq and Afghanistan and stalemate over Iran’s peaceful nuclear programme. There are some other factors too that cannot be ignored.
In this scenario, the oil consuming countries should unite and form an energy organization to tackle important issues like pricing of oil and gas, demand-supply gap and support new energy technologies. Such a body should take things into hands as this vital sector cannot be left on mercy of market forces. Efforts by Opec to control prices have generally been less influential than market forces.
This body will also compile the scattered oil and gas data and will be able push oil producers to take proper decisions. In many countries the consumers decide and dictate prices to the producers, why not 195 countries try this in energy sector?
The international energy organization could speed the transfer of appropriate energy technology to poor countries and give them advice on an optimal energy mix that is safe, secure and environmentally sound. Also, this can ensure energy supplies in crises, emergencies, war and disasters. It will also frame policies to benefit rich and poor alike.
True global energy security will be a result of cooperation and engagement, not isolationism. There is a need to ignite engine of innovation so that energy is available to everyone. Balancing the needs of producers and consumers is as crucial as increasing supply and curbing demand. Only then will the world enjoy energy peace-of-mind, he said. Once we all start to think differently about energy, then we can truly make this promise a reality. The need for joint action to develop solutions to the looming energy crisis; world need to act before crisis turns into calamity and end on tragedy.- Pakistan Economic Watch