Security of supply is a nagging worry in Asia, which buys 55% of its oil from the Middle East. Each year of Asian economic expansion feeds growing demand for crude from the Middle East, home to 60% of the world’s oil reserves.

“Asia has a huge dependency on the Middle East, so security of supply is always on their minds,” said Paul Tossetti, director of oil market analysis at Washington-based PFC Energy.

Saudi Arabia arrested more than 170 people on Friday suspected in a plot to attack oil facilities and military bases.

At the second meeting of Middle East and Asian oil ministers in Riyadh today, importers will also be seeking a form of security they are unlikely to find - the opportunity to buy into oil and gas fields to guarantee future supply.

“Some countries would like to interlock their relationship through investment in the upstream sector in the Middle East,” said Yonghun Jung of the Asia Pacific Energy Research Centre.

But most of the region’s oil reserves are off limits. Saudi Arabia, with the world’s largest oil reserves, forbids foreign investment in its upstream oil sector.

The world’s second-biggest crude importer proposed renting out some of its oil storage tanks to Saudi Arabia, offering the kingdom better access to Asian markets while retaining the right to draw on the reserves during an emergency.

Japan has expressed concerns about securing resources in the face of increasing competition from China and India.

The price of oil will also be high on the agenda, analysts said. London Brent traded at just under $68 a barrel yesterday, and has risen 33% from a mid-January low.

The ministers of six Opec members will be in Riyadh, a follow-up to the first Middle East and Asian energy ministers meeting in India in early 2005.

Asian ministers may ask Opec to open the taps and reverse some of the 1.7mn barrels per day cuts the producer group agreed late last year.

Consumers have called on Opec to help bring down the price and prepare for a seasonal rise in demand in the third quarter.

But Opec ministers have said the crude market is balanced, blaming the high price on tight gasoline supplies in top consumer the US and political tension.

Oil producers have embarked on massive spending programmes to boost supply and will be looking for pledges that future demand will be there.

The high price of oil has encouraged consumers to look again at other sources of energy, such as biofuels.

“Once you lock into biofuel initiatives on a large scale, there is no way back,” said Yonghun. “So Middle East producers are concerned about that.”

They will also be watching supply developments aimed at bringing central Asian and Russian crude to Asia, said PFC’s Tossetti.

Middle East oil producers want investors to look downstream at refineries, petrochemical plants and other heavy industry to help diversify their economies away from dependence on oil revenues.

PIN/REUTERS