Brown puts oil demand top of agenda

Gordon Brown will travel to an oil summit in Saudi Arabia next week, at the start of a diplomatic push that he hopes could develop into a global energy strategy, including pouring oil revenues into renewable power schemes.

The prime minister believes the key to cutting oil prices in the short-term is to map out a plan to break the world’s “addiction to oil” and to show that demand will not always inevitably outstrip supply.

Mr Brown is pressing western governments to lift restrictions to investments by sovereign wealth funds – including those run by Gulf states – to allow them to fund renewable energy schemes, making them less dependent on oil in the future.

In exchange he wants oil producing countries to relax their restrictions to enable western companies easier access to their oil fields to boost supply.

The prime minister, speaking to journalists in Downing Street, said he wanted to change the terms of the global energy debate to make it clear that the world was committed to cutting its dependence on oil.

However, analysts said nuclear power would not resolve the problem of oil dependency as transport is the main driver of oil demand rather than electricity generation.

He said Britain’s commitment to a big expansion in nuclear power was likely to be replicated across the world and that as many as 1,000 new nuclear power stations could come on line in the next 40 years.

Mr Brown, who served 10 years as chancellor, believes he is well placed to negotiate an international response to the problem of soaring oil prices, which is causing him – and other western leaders – serious domestic problems.

He said he would attend an oil summit in Jeddah on June 22 bringing oil producers and consumers together, after discussing the initiative this week with King Abdullah, the Saudi monarch.

“I proposed to the king that, if necessary, I will be happy to convene a follow-up summit at heads of government level and have offered London as a venue,” he added.

Mr Brown, however, admitted the Jeddah summit was unlikely to yield a short-term boost to oil supplies. Oil prices have surged by 40 per cent since January and now stand at about $135 a barrel. Mr Brown has described the operation of the Opec oil cartel as “scandalous”.

Mr Brown will discuss the idea of a global energy strategy with Nicolas Sarkozy, the French president, next week in Paris ahead of an EU summit in Brussels, and has also discussed a European response to rising energy prices with José Manuel Barroso, president of the European Commission.

He will also raise the issue at the G8 summit of leading industrial nations at a summit in Japan next month.

But Alan Duncan, Conservative business spokesman, claimed Mr Brown’s initiative was bluster. “How many times does he have to be told that turning on the taps is not as easy as he’s making it out to be and won’t necessarily solve the problem?” he asked.

“How long does he want to persist in this wilful deceit? Instead of tilting at the Opec windmill we should be weaning ourselves off fossil fuels and changing our patterns of energy consumption – something the government has completely failed to achieve over the last ­decade.”