This is IN THE NEWS in VOA
much of the year, record prices for oil have made oil-producing nations
rich. Now these nations are trying to cut
production to support collapsing prices.
Last week, the Organization of
Petroleum Exporting Countries met in Algiers.
Members agreed to a record production cut of more than two million
barrels a day, or about five percent of world output. OPEC's president said the
group may call an emergency meeting in March if prices continue to fall.
Less than six
months ago, oil traded at a record one hundred forty-seven dollars a barrel. Governments and oil companies in Russia,
Brazil and Saudi Arabia spent billions of dollars to develop new oil fields. Now, oil is trading for less than forty
dollars a barrel—down over seventy percent.
the root of the sharp price decrease is reduced demand because of the economic
downturn. The American Petroleum
Institute says demand for oil in the United States fell by three percent in the
first half of the year compared to the same period last year. Americans are
driving smaller, more fuel efficient cars.
And they are driving less.
the Energy Information Administration released a report on oil use in the
United States. The Annual Energy Outlook
for Two Thousand Nine predicts that American oil use will remain mostly unchanged
through the year twenty thirty. The
report says new fuel efficiency rules for vehicles, requirements for increased
use of renewable fuels and increased fuel prices will limit demand. The United States is the world's largest user
oil prices mean producing nations will face something they may not have planned
for: budget deficits. Saudi Arabia is the
world's largest oil exporter. But it
expects a budget deficit in two thousand nine — its first in six years.
the world's second largest exporter, also predicts a budget deficit next
year. Some nations depend on oil exports
more than others. For example, oil
provides eighty percent of Iran's foreign income.
not the only energy resource in the news recently. Russian Prime Minister Vladimir Putin warned
that a period of low natural gas prices is coming to a close. Mister Putin spoke at a meeting of the Gas
Exporting Countries Forum in Moscow. The
fourteen-member group includes Russia, Iran and Venezuela.
natural gas is transported through pipelines under long-term contracts. This limits the prices suppliers can charge. But the new process of liquefying natural gas
may change that. Mister Putin said
liquefied natural gas has become an expanding industry that requires new
investment in processing centers.
Energy Minister Rafael Ramirez said the Gas Exporting Countries Forum will have
more power over prices as the world market becomes more developed.
that's IN THE NEWS in VOA Special English, written by Mario Ritter. I'm Steve