News: 'Oil prices risk "body blow" to growing nations'

(RTR 21/04/2006) Doha - The world's top oil producers must pump more to ease record prices or risk dealing a body blow to fast-growing developing nations, India's oil minister told Reuters on Friday.

Booming demand in India and China has been a prime driver in oil's four-year rally, but the onus is now on major producers to ease prices, Murli Deora said in an interview.

"They must realize that such high prices should not give a body blow to the developing nations," he said ahead of producer-consumer talks in Doha.

"It all depends on the producing countries. They should produce more and there should be some pressure on prices."

Oil has risen from $20 a barrel in 2002 to over $70 this week on unchecked demand in the United States and Asia and fears of supply outages in OPEC members Iran and Nigeria.

India's oil demand is set to grow higher still.

"If our GDP (gross domestic product) is to grow and development take place, then demand has to grow," Deora said "I'm not against growing demand. Demand should go up. Prices should not be so high."

India's growing appetite for energy has sent it scouring the world for more supplies -- even in league with China -- putting Asia's top consumers in competition with Western oil majors.

India is looking to deepen its ties with China, Deora said.

It is a relationship causing some concern with Western oil executives who see the tie-up making their hunt for energy more difficult.

"We are very happy to work with them...It's a very friendly atmosphere. We have very good cooperation with them," Deora said.

"China and India both have such high demand and we all hope there is some control on prices."

Another of India's top priorities in Doha is to boost imports of liquefied natural gas (LNG) from Qatar, Deora said.

The country, the world's sixth largest oil consumer, is also looking within its own borders to boost production and has been actively seeking foreign investment.

Though no American company has bid in India's previous oil exploration licensing rounds, Deora said he expects U.S. oil majors such as Chevron and Exxon Mobil to participate in an upcoming round later this year.