KUALA LUMPUR (Kyodo) Malaysia, a net oil exporter, does not plan to build an emergency oil stockpile because it would be too expensive, Deputy Prime Minister Najib Abdul Razak said Monday.
Najib was essentially pouring cold water on an offer by Japan last week to help finance and provide the technical assistance to Southeast Asian countries to build an oil stockpile as a security response measure.
“It requires a lot of money for that. I don’t think we have an immediate plan to do that. We are not going to war, so it’s OK,” he told reporters after opening the Asia Oil and Gas Conference.
Japan made the offer during a meeting in Manila between members of the Association of Southeast Asian Nations and its three dialogue partners, Japan, China and South Korea.
“Oil stockpiles, which form the basis of an energy security response, are not yet sufficient in our region. It is necessary to further strengthen the program and to consider a coordinated operation in the future,” Shoichi Nakagawa, minister of economy, trade and industry, told his ASEAN colleagues last week.
A speech by Malaysian Prime Minister Abdullah Ahmad Badawi Najib that was read out by Najib to the oil meeting Monday outlined the challenges faced by Asian countries where fuel consumption is rising rapidly due to economic expansion, especially in China.
Demand for oil in Asia reached 22 million barrels per day in 2003 and is expected to hit 32 million barrels per day by 2025, more than double the region’s total consumption in 2001.
China’s crude oil consumption last year alone was equivalent to nearly 70 percent of the combined consumption of France, Germany, Italy and Britain, according to Abdullah. Only the United States consumes more crude than China.
The average annual growth rate of fuel consumption on the Asian continent is now 3.2 percent, almost three times higher than that of industrialized nations worldwide, and 64 percent of the fuel has to be imported.
Energy security is not only vital to power Asia’s factories and furnaces, according to Abdullah, but with one in every five Asians still living below the poverty line there is a need to ensure access to reliable and affordable energy sources.
He called for greater collaboration between national oil companies in Asia to maximize utilization of limited resources.