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HONG KONG: Current oil prices will have no impact on growth in Asia, the oil minister for top exporter Saudi Arabia said yesterday, even as the region’s biggest economies struggle with rising energy costs in their efforts to boost growth.
Benchmark Brent has traded above $100 a barrel for most of the time since early 2011, driven by supply concerns. The unrest in Libya to the standoff over Iran’s nuclear programme have all helped keep prices high, worrying investors elevated energy costs will hurt the fragile global recovery.
Japan, one of the world’s top crude importers, is battling a huge trade deficit and India is fighting to rein in ever-growing domestic subsidies as prices rise. China’s central bank dropped its pro-growth policy mix of 2012 as inflation touched a 10-month, even though economic recovery in the world’s second-biggest oil consumer has yet to gain full momentum.
But, overall stability in prices has created an environment that is conducive for long-term sustainable growth, Ali bin Ibrahim Al Nuaimi said.
“Current levels will not deter further economic growth in Asia,” Nuaimi told the Credit Suisse Asian investment conference in Hong Kong. “The prospects for the energy industry are stronger now than anytime in recent history. “While the fluctuation in prices may be good for a few traders, it’s not good for long-term economic stability and growth.”
Last October, Nuaimi said an oil price of $100 per barrel was suitable for both consuming and producing nations. Reuters