From Europe to Asia, oil prices take their toll

All around the world, in a multitude of ways, the soaring price of oil is hurting rich and poor alike. For the lucky ones, it is simply a matter of changing their lifestyle. But those most vulnerable to the price of oil have been driven on to the streets in angry protests, which raises a fundamental question: What can we do to survive in a world where a barrel of oil costs $127. MIDDLE EAST Not even the region with the world's largest oil reserves has escaped the pressures. As major importers beg major producers to release millions more barrels on to the world markets, Middle Eastern countries unlucky enough not to be sitting on lakes of black gold are facing growing resentment from their own populations over fuel prices. In Egypt, petrol prices have risen by as much as 40 per cent in a year. Yemen has been rocked by riots in the south, which is home to only a fifth of its 22 million population but produces 80 per cent of the country's oil. Young men and separatists, angry that little of the nation's oil wealth has trickled down to ordinary people in the south, have been protesting since April, raising concerns that militants could exploit the unrest. In Gaza this week, where fuel shortages have long been a major source of seething discontent due to rationing by Hamas, Palestinians were forced to fill their cars with olive oil instead of diesel. Iran is acutely vulnerable to rises in fuel prices because, despite being the world's second largest producer, it is still forced to import about 40 per cent of its petrol because of a lack of refining facilities. Protests last year over fuel prices brought in rationing, which is still in place. GREAT BRITAIN The rise in the oil price could not have come at a worse time for Prime Minister Gordon Brown. After a week that has seen hauliers blocking roads and air passengers facing higher surcharges, the impact on fuel bills has come to the fore. Brown's attempt to ease the pain felt by pensioners and low-income families from rising fuel was dismissed as a "sticking plaster to hold back a catastrophe". It consists mainly of advice on coping with the cost of heating rather than extra money. Alistair Darling, the Chancellor, said the energy suppliers had agreed to increase "social assistance" from £50 million (Dh375m) a year to £150m by 2011. The money will be used to switch consumers to lower tariffs and insulate homes. The government's announcement came at the end of the week in which Brown saw a rerun of the political crisis he faced in his early years as Chancellor with lorry drivers blockading British roads to demand that a planned 2p rise in fuel tax be scrapped and that "essential users" should be granted a rebate. Separately, Britain's Silverjet airline announced it had stopped flights after failing to get a $5m loan from Abu Dhabi-based investors, becoming the third London to New York business class-only carrier to run out of money. EUROPE Luxembourg's Finance Minister, Jean-Claude Junker, who chairs the commission of European Union finance ministers, issued a call to all EU governments this weekend to hold their nerve and avoid the temptation to use the tax system to relieve the misery of high oil prices. He reminded them that, when they met in 2005, they agreed that such a move would encourage demand and send the wrong message to oil producers. That is not what France's President, Nicolas Sarkozy, wanted to hear, after a week of protests by French truckers and fishermen left several motorways blocked and ports paralysed. Sarkozy suggested capping fuel taxes if the oil price rose further. In the Netherlands, the protests caused less inconvenience, but made more noise – on Thursday, lorry drivers across the country simultaneously blew their horns in protest at diesel prices. In Bulgaria, lorry and bus drivers launched a joint protest. The protest also spread to the seas, as fishermen across Europe went on a one-day strike, blocking ports. The biggest demonstrations were in Spain and Portugal, where 10,000 protesters converged on Madrid. Some handed out free fish to underline their point that, with the current cost of fuel, they are practically giving their catches away. Passers-by pushed and shoved to get their hands on the free hake. THE UNITED STATES There are signs that the fuel crisis is persuading Americans to think about leaving the car in the garage. In March this year, the number of miles driven by American motorists was 11 billion fewer than in March 2007, according to the Transportation Department. That is the sharpest drop year on year that the department has ever recorded, and the first fall of any kind recorded in the month of March since 1979. The US Energy Department projects that this year, domestic gas consumption will drop by 190,000 barrels a day and overall petroleum use by 330,000 barrels a day, the first annual fall since 1991. But those figures look less impressive when expressed as percentages. Eleven billion fewer miles is a drop of 4.3