The Tokyo Summit

Posted by Oilism.com on September 6th, 2010 at 06:38pm

The Tokyo Summit

THE leaders of the seven most industrialized democracies today open their summit conference . . . to find a way out of the deepening world oil crisis, reported the Mainichi Daily News.

But did they find a way out? What was the result of this impressive summit conference held in Tokyo, Japan, this past summer, representing the leaders of some of the most powerful nations? Indeed, why was the meeting held?

Since the oil crisis of 1973, when the oil-exporting nations dramatically increased oil prices, the countries having to import oil have been hard pressed by inflation, recession and disorder in world money markets. For this reason, beginning in 1975, annual economic summit conferences were held to find solutions.

But are the nations better off now than they were four years ago? No, for there was even greater urgency at the Tokyo meeting because of the energy crisis of 1979.

So this summit meeting concentrated on energy. The main issues were: the oil supply, oil prices, inflation, the gap between richer and poorer nations, and international money woes.

However, as if to taunt the summit, on the very day its meeting opened, a three-day conference of the Organization of Petroleum Exporting Countries (OPEC) concluded in Geneva, Switzerland. Its result? The OPEC nations announced another large increase in oil prices, pushing the price as high as .50 (U.S.) a barrel, when not too long ago it was about one tenth that price! This increase, on top of others made this year, means that oil prices have risen about 50 percent in 1979!

What Was the Outcome?

What did the Tokyo summit accomplish? Since the main target was the oil problem, a joint declaration said: The most urgent tasks are to reduce oil consumption and to hasten the development of other energy.

The participating nations agreed to try to maintain, for about five years, a level of oil imports no greater than that of 1977 or 1978. However, some observed that this was not much help, since oil imports were at peak levels then.

The summit declaration also spoke of intensifying efforts to pursue the economic policies appropriate in each of our countries to achieve durable external equilibrium. In other words, each country will make its own decision as to what is appropriate economic policy.

One paragraph caused discomfort for Japan. It said: We deplore the decision taken by the recent OPEC conference. We recognize that relative moderation was displayed by certain participants. But the unwarranted rise in oil prices nevertheless agreed upon are bound to have very serious economic and social consequences.

The Daily Yomiuri reported: Foreign Minister Sonoda was displeased with the strong censure of OPEC. Why this sensitivity? Because Japan imports almost all its oil from OPEC. Thus the article concluded: One top Foreign Ministry official said after the Tokyo summit that Japan would take steps to placate the oil-producing nations.

Obviously, these seven nations did not achieve one of their most important goals—unity of action. Also, the problems confronting these, and other nations, are just as large now as they were before the Tokyo summit. Actually, they are larger, because the price of oil is much higher now.

Under OPEC