BBC Home
Explore the BBC
BBC News
Launch consoleBBC NEWS CHANNEL
Last Updated: Friday, 23 September 2005, 11:41 GMT 12:41 UK
G7 concern over oil price surge
An oil refinery in Galveston Bay, Texas City
Oil is expected to take up a major part of the G7 talks
Finance ministers from the Group of Seven leading industrialised nations are meeting in Washington to discuss the economic impact of high oil prices.

At about $66 a barrel, crude prices have risen more than 50% this year.

At Friday's meeting, they are also due to consider enlarging the group to take in major emerging economies such as China, Russia and India.

The talks come at the sidelines of this weekend's annual meeting of the World Bank and International Monetary Fund.

The meeting of ministers and central bank chiefs will be hosted by US Treasury Secretary John Snow.

The G7 countries - the US, UK, Canada, France, Germany, Italy and Japan - are due to open the proceedings with a lunch also attended by the finance ministers of Brazil, China, India, Russia and South Africa.

Demand driven

"The high oil prices will take up a significantly big portion of the overall macro-economic discussions," Japanese Finance Minister Sadakazu Tanigaki told reporters late on Thursday.

However, it is unclear what the group can actually do to bring prices under control, analysts say.

Even before Hurricane Katrina and Hurricane Rita disrupted oil supplies in the US, surging world demand was already pushing oil prices higher, they point out.

Mr Tanigaki said G7 members would do their utmost within their remits to deal with soaring energy costs, but gave no details.

Currency fears

The finance ministers are also expected to discuss reform to the world's currency system, with the US urging China to allow its currency to fully float on world markets.

This could lead to a significant increase in the value of the yuan, which might curb China's rapidly growing exports - and reduce the huge trade surpluses that are threatening to unbalance the world economy.

China took a small step in this direction ahead of the meeting by allowing the yuan to fluctuate more widely against non-dollar currencies.

It revalued its currency in July by 2.1%.

The G7 is intended to bring together the world's seven most industrialised countries, but does not include rising powers China and India.

At its annual summit of leaders, it becomes the G8, with the inclusion of Russia.




SEE ALSO:
Oil firms braced for Rita's rage
23 Sep 05 |  Business
Opec to increase oil production
20 Sep 05 |  Business
Profile: G8
27 May 05 |  Country profiles


RELATED INTERNET LINKS:
The BBC is not responsible for the content of external internet sites


PRODUCTS AND SERVICES

Americas Africa Europe Middle East South Asia Asia Pacific