According to an article by Javier Blas and Ed Crooks in the Financial Times (London), the Secretary-General of the Organisation of the Petroleum Exporting Countries (OPEC), Abdalla El-Badri, warned Western countries yesterday that their efforts to develop biofuels as an alternative energy source risked driving the price of oil “through the roof”.
Oh, the irony of it all.
One of the main arguments used by proponents of the U.S. Government’s heavily subsidized drive to develop biofuels is that increasing the supply of these fuels would pour oil on the troubled waters of the world petroleum market, as it were — stabilizing prices (“Don’t worry about rising fuel prices; we’ll fix that problem with home-grown biofuels!”) and reducing dependence on risky foreign sources of crude oil. But no:
OPEC has previously expressed scepticism about alternative energy but Mr El-Badri’s comments mark the first clear threat that the cartel might act to safeguard its interests in the face of a shift towards biofuels.
“They are really concerned,” said Julian Lee of the Centre for Global Energy Studies in London. “OPEC will continue investing, but with biofuels on the horizon, they may not invest enough.”
“It is a difficult situation for OPEC. On [the] one hand they are asked to produce more, on the other one, Washington and Brussels are telling the cartel ‘we are betting on biofuels and we don’t want to rely on you [OPEC]’.”
Joining the likes of Lester Brown and Fidel Castro, Mr. El-Badri warned that biofuel production could prove unsustainable in the medium term as it competed with food supplies.
The price of Brent crude rose on Tuesday to $70.60 a barrel, close to a nine-month high.