JEDDAH, 19 November 2005 — The negative impact of oil tax on end-users in consuming countries will be the focus of a major seminar to be opened in Riyadh today, said Minister of Petroleum and Mineral Resources Ali Al-Naimi.
He said the seminar would be held on the sidelines of the inauguration by Custodian of the Two Holy Mosques King Abdullah of the permanent headquarters of the International Energy Forum today.
“The seminar will not only discuss vital oil issues but also draw the road map for the industry’s future, making use of technological resources,” the Saudi Press Agency quoted Naimi as saying.
King Abdullah last month urged industrialized countries to play their part in stabilizing world oil market by either lifting or reducing taxes on oil products. He made the comment while meeting with IMF Managing Director Rodrigo de Rato.
Maintaining taxes at the current levels would impact on the future investment in oil producing countries and on the petroleum market in general.
Dr. Nahed Taher, an economist, said high oil prices in OECD (Organization for Economic Cooperation and Development) countries were the result of high taxes imposed by them.
She said some countries were imposing taxes as high as 75 percent of the total cost of oil. “As a result, these countries make an income which might be three to four times what the oil producing countries make from higher oil prices,” Taher pointed out. The money Italy makes out of oil taxes is three times more than what the United Arab Emirates makes out of oil exports, she added.
Naimi said the opening of IEF headquarters would promote “continuous and organized” dialogue between producers and consumers as well as companies and international organizations.
King Abdullah proposed the establishment of the headquarters while opening the 7th IEF conference in Riyadh five years ago.
Oil ministers from major producing and consuming countries including Germany, Iran, Italy, Britain, France and the United States will attend the opening, Naimi said. The heads of many international oil companies will also be present, he added.
The International Energy Forum is an informal gathering of energy ministers from energy producing and consuming countries with aim of building confidence, exchanging information, and developing a better understanding of the underlying energy issues affecting the world.