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Oil producers are urged to raise output

Energy-consuming nations sought the increase, hoping to cut prices, but differed on policies.

AOMORI, Japan - Leading energy-consuming nations urged oil producers yesterday to boost their output to counter soaring prices threatening the world economy, while they pledged to develop clean energy technologies and improve efficiency.

The five nations - the United States, China, Japan, India and South Korea - differed, however, on how urgently oil subsidies should be phased out, with Washington backing bold movement while India and China warned of political and economic instability.

Cabinet ministers from the five countries, which account for more than half the world's consumption of energy, agreed that the sharp surge in oil prices was a menace to the world economy and that more petroleum should be produced to meet rising demand.

"It's not good for producing nations to see the U.S. struggling economically. They depend on us to be a significant engine in world economic activity," U.S. Energy Secretary Samuel Bodman said.

The current president of the Organization of Petroleum Exporting Countries, Chakib Khelil, has said that the cartel would make no new decision on production levels until its Sept. 9 meeting in Vienna.

Oil prices made their biggest single-day surge on Friday, soaring $11 to $138.54 a barrel on the New York Mercantile Exchange, an 8 percent increase.

World oil production has stalled at 85 million barrels a day since 2005, while global economic growth - boosted by spectacular surges in China and India - has pushed demand to unprecedented levels.

Analysts also have cited the decline of the U.S. dollar, fears about the long-term supply of oil, and aggressive speculation as factors in rising prices.

The five consumer countries, meeting before an energy conference of the Group of Seven industrialized nations and Russia today, argued that the unprecedented prices were against the interests of both producers and consumers and imposed a "heavy burden" on developing countries.

The ministers also vowed to diversify their sources of energy, invest in alternative and renewable fuels, ramp up cooperation in strategic oil stocks in case of a supply shortage, and improve the quality of data on production and inventories available to markets.

The group diverged somewhat over oil subsidies. The International Energy Agency has estimated that oil subsidies in China, India and the Middle East totaled about $55 billion in 2007.

The United States, which has its own energy subsidies, urged countries such as China to lower their oil supports, which enable domestic consumers to enjoy cheaper gasoline. Subsidies shield consumers from higher prices, meaning consumption does not decline despite rising expenses.

But China and India, while signing on to a statement recognizing the need to eventually phase out such subsidies, argued that removing such supports quickly could trigger political and economic instability.