Bush's oil pledge lacks credibility

President Bush's State of the Union address was reminiscent of a broadcast by then-president Jimmy Carter in 1979 when the latter declared that "Beginning this moment, this nation will never use more foreign oil than we did in 1977 - never. I am tonight setting the further goal of cutting our dependence on foreign oil by one-half by the end of the next decade - a saving of over 4.5 million barrels of imported oil a day."

It never happened. Foreign oil accounts now for 58 per cent of total US consumption, a figure likely to rise to 68 per cent by 2025.

Bush's plans similarly have been criticised as non-achievable and could make needed investment in the region's oil industry more difficult. The International Energy Agency which advises 26 countries, including the US, on world energy matters has said the Middle East needed to invest heavily in order to meet global demand.

$56bn-a-year investment

The International Energy Agency's chief economist Dr Fatih Birol believes that an estimated $56 billion a year is required to be spent by Middle East and North African countries in their on oil and gas sectors over the next 30 years.

If oil production continues at current levels some of the larger and medium-size producers including Russia, the US, Mexico, Norway and Brazil could be played out in the time span making the Middle East an even more important source of oil and possessing the only major reservoirs of oil.

Saudi Arabia's ambassador to the US, Prince Turki al-Faisal told CNN TV that he was taken aback by President Bush's call. The ambassador said he had met US national security advisor Stephen Hadley at the White House to discuss concerns since Saudi oil accounts for some 15 per cent of America's crude imports.

Martin Bartenstein Minister of Economics of Austria, which is the current holder of the European Union presidency, declared: "I would not see myself in a position of talking about such a significant decrease in demand from a certain region. We know that the oil import dependency of the EU will increase, not decrease."

Paying the price

According to Frank Verastro, director and senior fellow in the Washington-based Center for Strategic and International Studies energy programme:

"Even if America doesn't import a drop of Middle East oil, these countries will still play an increasingly important role in determining how much we pay for oil. You have to pay the global price and it doesn't matter where you buy it from."

Two years ago ExxonMobil's former executive vice president Harry Longwell said: The Middle East will remain the largest and most important supplier of oil for decades to come. We expect that around 20 per cent of our worldwide upstream capital expenditures will be in the Middle East through the end of this decade, and this could be larger with potential new openings."