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High and volatile oil prices are here to stay, according to economic and energy analysts during a video conference on Oil Volatility, Economic Impacts, and Risk Management in Asia held at the Asian Institute of Management Global Distance Learning Center (AIM-GLDC) on June 4, 2008. The video conference was hosted by the Asian Institute of Management Policy Center and the Konrad Adenauer Stiftung in the Philippines, and was organized by the World Bank Institute, the George Washington University in Washington DC, and the Tokyo Development Learning Center (TDLC).

Participants from several Global Distance Learning Network centers in Japan, Indonesia, the Philippines, Thailand, and Washington DC, which included several government officials, private sector groups, representatives from energy-intensive industry groups, sector analysts, researchers, and think-tank organizations across emerging market economies in Asia pooled together to discuss the implications of the currently pressing issue of volatile oil prices worldwide.

Oil prices worldwide have risen to unprecedented heights in the past few months, reaching a record peak of US$135 in May 2008. Philippine pump prices have increased sharply up to 55php per liter, with oil companies mulling over further increases in fuel prices in the next few weeks. Both industry sectors and private citizens have been greatly affected, posing long-term challenges to economies worldwide, exacerbating issues of poverty, inequality and social stability. The long-reaching effects of volatile oil prices have spurred debate as to how the government should handle the on-going oil crisis.

Experts Dr. Ken Koyama, Director and Board Member of the Strategy and Industry Research Unit at the Institute of Energy Economics, Japan (IEEJ), Prof. Robert Weiner from the George Washington University provided in-depth analyses into the causes behind the current price hikes, pointing to recent high demands for energy and oil consumption in fast-developing countries across Asia and the Middle East, stagnating supply from OPEC, geopolitical tensions and natural disasters in certain oil-producing countries such as Iraq, Iran and the United States, market speculation and fears over inadequate supply as some of culprits behind the world’s current petroleum woes.

With oil volatility here to stay for the next few years then begs the question as to how countries worldwide would be able to cope with the current situation. Discussions ranged from the current widespread practice of government fuel subsidies, the development of good mass transit systems, and the exploration and usage of alternative energy sources, and urged solutions that benefit the majority in the long-term.

Other resource persons for the video conference included pre-taped interviews with several experts: Guy Caruso, head of the US Energy Information Administration , Jim Burkhard, Managing Director of the Cambridge Energy Research Associates, Yasser Mufti, Head of the Energy Outlook Group for Saudi Aramco, and Dr. Atchana Waiquamdee, Deputy Governor of the Bank of Thailand.