Prices reached US$124 a barrel yesterday, after peaking earlier this month at US$127. Worldwide output fell 700,000 barrels in March amid ongoing political turmoil in Libya, Yemen, Syria, Nigeria and the Ivory Coast.
CEO of Aramco Khalid al-Falih told an industry gathering in South Korea that “We are not comfortable with oil prices where they are today… I am concerned about the impact it could have on the global economy.”
The Maldivian economy is dependent on oil to such an extent that is spends a quarter of its GDP on it – US$245 million – the vast majority on marine diesel, making imported energy one of the single largest drains on the country’s economy.
Customs documents obtained by Minivan News in January showed that Maldives was spending almost US$100,000 more per day more on fossil fuels than it was in the summer of 2010. At that time, oil was US$86 a barrel.
By the same calculations but with today’s oil price, the Maldives is paying an additional US$450,000 per day for oil compared to summer prices last year.
In a previous interview with Minivan News, President Nasheed’s Energy Advisor Mike Mason suggested that spiralling oil costs could prove to be a strong argument for a return to sailing.
“I think there is a huge opportunity to take a knowledge of sail, wind and current – the thinking that has served the Maldives well for 2000 years – and apply modern technology such as solar to create a new transport paradigm. A sailing vessel with a modern hull, utilising modern technology can reach 30-40 knots, and would greatly reduce the reliance on diesel,” Mason said at the time.