The G-7 countries, long recognized for being the world’s leading industrialized economies, pleaded on Tuesday for a greater oil output from the largest oil-producing countries. The G-7, which includes the United States, Canada, the United Kingdom, France, Germany and Italy, pinned their requests on the increased demand for oil and the continually rising prices. The price of crude oil futures has risen 24 percent in the past two months, including an 86 cent increase on Tuesday to $96.33 a barrel.
Though Saudi Arabia has committed to providing relief for oil-dependent countries if absolutely necessary, most members of the Organization of the Petroleum Exporting Countries (OPEC) have been less than forthcoming. Complicating matters is the recent devastation of Hurricane Isaac which has halted 93 percent of the oil production in the Gulf of Mexico for the time being. While the country is not yet desperate enough to tap into its reserves such a move could be necessary if the storm doesn’t pass in the near future.
The G-7 countries contend that higher oil prices and the subsequent increasing gasoline prices are having a direct and dramatic impact on economies worldwide and that the best way to keep prices down is to increase demand, as many of today’s struggling economies should focus on recovery, not on dealing with additional complications. Though gas prices in the United States have increased by 43 cents since July 1st, France’s government has begun to intervene by pumping 300 million euros into gas subsidies so that its citizens will not suffer and the economy will remain stable.
Analysts expect that should the OPEC countries refuse to increase oil output, countries may begin to tap their oil reserves as a way to keep prices down. Still, no politicians have yet confirmed their decision to do so.