Tensions between Israel and its neighbours have sent crude oil prices above 78$ a barrel just one day ahead of a meeting of world leaders in Russia devoted to energy supply security.
Planned discussions over Iran’s nuclear enrichment programme will carry additional significance at the G8 summit in St Petersburg this week-end as tensions in the Middle East mount.
Oil prices closed above $78 a barrel in Tokyo on Friday as violence between Israel and Lebanon threatened to spread to neighbours Syria and Iran. The two were accused by Israel of supporting the Hizbollah attacks that triggered the riposte.
“We are all conscious of the fact of Iran’s links with Hizbollah”, UK Foreign Secretary Margaret Beckett said on Thursday, adding: “We urge all those countries with influence over Hizbollah and Hamas to play their part.”
Reuters reported Iranian President Mahmoud Ahmadinejad as saying that any Israeli strike on Syria would be considered an attack on the whole Islamic world that would provoke “a fierce response.”
The developing crisis could hijack planned energy talks that Russian President Vladimir Putin wanted to focus around global energy supply security and the peaceful expansion of nuclear power to emerging nations (EURACTIV 11 July 2006).
The EU Commission said it hoped the G8 meeting to agree on a set of principles to guide global energy security. These are:
- A market based system;
- A rules based system based on transparent, stable and effective legal regulatory frameworks;
- Diversification of supply and demand of energy source, of country of origin, transportation and means of transport.