Speech by H.E. Mr. Ryutaro Hashimoto
Special Envoy of the Prime Minister
at the Opening Ceremony of the Seventh International Energy Forum

November 17, 2000 at Riyadh

On the occasion of the opening of this Seventh International Energy Forum, I would like to say a few words on behalf of Japan, a cosponsor of this meeting.

This is the first time in three years since 1997 when I visited this country as prime minister. I am extremely delighted to be able to visit this beautiful city of Riyadh again. I would like to express my heartfelt gratitude to Your Royal Highness Crown Prince Abdullah, who invited me here, and all the people of the Kingdom of Saudi Arabia, and my sincere appreciation to Your Excellency Mr. Al-Naimi, Minister of Petroleum and Mineral Resources, and others for their great efforts in preparing for this forum.

It is very significant indeed that oil-producing countries and oil-consuming countries are holding a dialogue here in the capital of Saudi Arabia, which is the largest oil-producing country in the world and a most important standard-bearer for the oil supply that keeps the world economy running. Japan is very honored to be able to contribute to this important meeting as a cosponsor.

Even now petroleum accounts for 40% of the world's energy supply. Supported by a stable supply of energy, the world economy has achieved spectacular development so far. Petroleum has played a central role, continuing to be the most fundamental and essential energy resource for us. However, the price of petroleum shows extremely unstable fluctuations. In just a single year, the price can either fall by a half or more than triple. At present the price exceeds $30 per barrel. I am concerned about the impact of this situation on the world economy.

It is clear that many countries in the Asia-Pacific region have the same concern as I do. As an example, I would like to call your attention to the report on the impact of the oil price hike on the member economies of the Asia-Pacific Economic Cooperation forum, delivered at its ministerial meeting at the beginning of this week. As for the several oil-importing countries in this region, it was pointed out that economic recovery could possibly be delayed. Now, as Asia is showing signs of recovery as a growth center of the world, it is necessary for us to think about this point from a global perspective.

With regard to petroleum, an essential energy resource for humankind, there are both oil-producing and oil-consuming nations in the world. Everyone here is attending this forum as a representative of one or the other. The present oil situation is certainly not a desirable one for either side. If the price of crude oil remains at a high level, as it is today, not only consuming countries but also producing countries could suffer in the long term because of a decline in demand. In other words, I would like to emphasize once again that the relationship between producing countries and consuming countries in the petroleum market is not a zero-sum game, in which one side profits and the other side loses. Rather, it is a win-win game, in which both the producing countries and the consuming countries stand to profit through a stable market.

Within their respective frameworks, producing countries and consuming countries have come to strongly recognize this relationship, especially since the beginning of this year, and both sides have been making efforts toward the stability of the petroleum market on the basis of this recognition. I highly commend these efforts as very welcome moves that give consideration to the development of the world economy.

At the same time, in order for oil producing countries to change the situation of heavy dependence on oil exports for the management of their economy, consuming countries may need to consider positively technology transfer, including assistance for human resources development, to producing countries, along with the efforts of producing countries to improve the environment for investment in their countries.

Ladies and gentlemen,
The relationship between oil-producing countries and oil-consuming countries is sometimes seen in a paradigm of confrontation, but this International Energy Forum has provided both sides with a valuable opportunity for dialogue. We must send out a strong message from Riyadh to the whole world that the oil-producing countries and the oil-consuming countries now enter into a new relationship of mutual understanding and cooperation, sharing a common interest in the stability of the oil market and the sustainable development of the economy.

As the representative of a cosponsoring country, together with the Netherlands, I intend to make the utmost effort to support Saudi Arabia, the sponsoring country, and to bring this meeting to success.

In the second session, when Japan serves as the chair, there is scheduled to be a discussion on energy and sustainable development and technology. As humankind, which exists on this planet, seeks to achieve sustainable development, we certainly cannot neglect our response to global environmental challenges. Some people fear that the beautiful island countries are going to sink into the horizon. We definitely must not let these fears become a reality. Since most of the greenhouse-gas emissions on Earth are caused by the use of energy by human beings, the mission of people like us involved in energy policy is extremely important. Also, needless to say, energy resources are finite. For the sake of our children and grandchildren, we must use these resources carefully. It is high time for us to cooperate beyond our positions as oil-producing or oil-consuming nations so that we can keep the environment and resources on which our lives are built in good shape for future generations.

For this purpose, it is in the interests of both oil-producing and oil-consuming countries to endeavor to use energy as efficiently as possible, and to advance the diversification of energy resources so that we do not excessively depend on any one form of energy. To promote investment and expand production in the energy development sector, thereby ensuring the stable supply of energy over the long term, also serves to our common interests. I look forward to constructive discussions on these issues in this meeting.

Discussions are also scheduled to take place in this forum on such issues as the energy demand and supply outlook and the state of the energy industry from now on. I hope that lively discussions will be held in the sessions from tomorrow so that, through the further promotion of understanding between oil-producing and oil-consuming nations, as I just said, this forum will be a wonderful beginning of a new relationship between the two sides.

Finally, I would like to close my speech by once again expressing my sincere appreciation to Your Excellency, Minister Al-Naimi, and others for their efforts in organizing this forum.

Thank you for your kind attention.