Seán Barrett
Ceist:7 Mr. S. Barrett asked the Minister for Energy if he will outline his long term plans to deal with the volatile oil market; and if he will make a statement on the matter.
Ceisteanna — Questions. Oral Answers. - Oil Prices.
The world economic system has not succeeded in averting volatility in the movement of the price of oil and related products. Ireland, like all net consumers of oil products, and this category, includes most of the worlds major economies, including the US, Germany and Japan, is a price taker when it comes to oil. Sustained efforts by both oil producers, and notably OPEC, and oil consuming countries have failed in their efforts to avert the volatility in prices so disruptive in terms of world economic order. There is little Ireland can do to cushion itself against rises in the oil price nor is there a valid case for not allowing price changes to flow through to the market.
A similar question was tabled when prices were high. However, when prices are low other concerns arise. Am I correct in saying that there is a growing view at EC level that larger strategic stocks should be maintained in various countries? Can the Minister say if this is so in our case? Can he also say if we are making plans to maintain in strategic locations larger stocks of oil than are currently required?
There may be some tentative suggestions in regard to changes in the requirement to maintain certain levels of strategic stocks but I do not think it has advanced to the stage suggested by the Deputy. It is important to remember that even in meeting the 90 day requirement which exists a very large cost has to be borne by the consumer. All the matters have to be carefully considered at EC level before any final decisions are made.
In view of the uncertain future of oil supplies over the next few years, in spite of the settlement of the Gulf War, does the Minister agree that there should be a coherent Government programme for a reduction in the use of energy? Would he consider asking international experts to comment on our conservation and efficiency in this area?
The Deputy should not worry, we will do it.
There is no concerted effort to ensure energy reduction. There is a concerted effort to reduce the consumption of oil here. This has been going on for the past ten years with some success, as was evident from the figures published when the trouble arose in the Middle East. Happily we are not now as dependent on oil as we were at the time of the last oil crisis. It will continue to be Government policy to seek to utilise alternative sources of energy to oil. Of course, the discovery of gas has greatly helped in this regard. The Government's proposed inter-connector between the Irish and British gas systems will be a major step in reducing our dependence on oil.
Would the Minister not agree that the Government have to achieve a delicate balance in regard to this issue? While high oil prices are disastrous for western economies, too low oil prices encourage the increased usage of oil, leading to increased vulnerability in the future. As Sheikh Yamani said, prices could go as low as $12 a barrel after the Gulf War. What is the Minister's view of the attempts being made by the EC and the International Energy Agency to stabilise prices at a level which will not encourage a rapid return to the use of oil, which would undermine all the work done in that area in the past decade?
Sheikh Yamani might have other ideas about the price of $12 per barrel. I do not think he will be too happy about this and he probably has other means available to him, through OPEC and other agencies, to look after his interests and those of his friends. A problem exists that when the price of oil is low people see no necessity for conservation policies and do not respond to the urgings by the Minister for Energy and others to be more efficient in the way they use oil. I have been through all this because when I came into the Department the price of oil was low and there was no danger on the horizon. We have to try to find a balance and continue to educate the public about the need to use oil efficiently. Our biggest hope of making progress would be to reduce our dependency on oil. I will continue to vigorously promote energy conservation and focus on the need to reduce our use of oil and CO2 fuels.
Does the Minister not think it is appropriate at a time when we have considerable gas reservoirs off our coast and we propose to establish an inter-connector between the Irish and British gas systems, that Bord Gáis be encouraged to extend their network of gas supplies to various towns? At present many towns adjacent to our cities have no gas supply because Bord Gáis are reluctant——
The Deputy is entering into another area well worthy of a separate question or questions.
If natural gas was more readily available to towns throughout the country we would be in a position to substantially reduce——
The Deputy is bringing in extraneous matter.
——our use of oil——
Sorry, Deputy Allen, the Chair is very concerned that we are making such little progress at Question Time today.
This is the first time I have intervened. Surely it is a relevant question?
We have dealt with seven questions in over 35 minutes.
I did not open my mouth before this.
That may be so but the fact remains that we are making no progress of any consequence at Question Time today. I appeal for brevity and succinctness. Let us move on to Question No. 8.
The point raised by Deputy Allen has been replied to here previously.