G7 leaders pledge action on soaring energy prices

Finance officials from the world’s biggest industrial powers said soaring energy prices posed a risk to global economic activity and pledged to do all they could to limit the fallout.

The energy situation was a key agenda item in discussions among finance ministers and central bank presidents from the Group of Seven countries. Britain, the US, Japan, Germany, France, Italy and Canada make up the group.

“Higher energy prices ... have increased the risks to the outlook,” they said in a joint statement.

They finance ministers, including Chancellor Gordon Brown, called for countries and producers to boost investment to increase the supply of oil and they also urged countries to explore alternative sources of energy and improve conservation efforts.

The G7 countries also pressed for more timely and accurate information about the oil market, which officials said could help control price fluctuations and make companies more willing to expand oil and gas production.

The finance ministers met as fears grow about increasing energy prices - catapulted by Hurricane Katrina that ripped though the US’ Gulf Coast in late August.

Energy prices could be pushed even higher by approaching Hurricane Rita, which is expected to make landfall today on the Texas Gulf Coast, home to the US’s biggest collection of oil refineries.

The finance ministers also called for the speedy enactment of a plan to erase billions of dollars worth of debts that poor countries owe the World Bank and other lending institutions.