Prime Minister Gordon Brown has held out the prospect of a fall in the cost of oil after a global summit in Saudi Arabia at which he said major producing countries accepted for the first time that prices are too high.
Mr Brown declined to predict what level prices would reach at the pump, but said agreement had been secured with members of the Opec cartel that record crude prices of almost 140 US dollars a barrel were causing damage and investment was needed to increase supply.
The Prime Minister came to the Jeddah summit with an offer to open Britain's energy markets to oil-rich states, urging them to reinvest some of the three trillion dollars of additional revenue from the current oil shock in UK energy production, including wind, solar and a new wave of nuclear power stations.
He revealed that Government plans, to be published in the coming week, will put a price tag of £100 billion for the UK to meet its share of an EU target to generate 20% of energy from renewables by 2020, much of which could come from the sovereign wealth funds of oil-rich Gulf states.
Speaking to reporters ahead of his address to ministers from 35 major oil-producing and consuming economies, Mr Brown said: "The reason I am here is that I am worried about the petrol price, I'm worried about gas and electricity bills, I'm worried about how millions of people are being affected in their standard of living.
"It is happening in every country in the world. It is a global problem that requires global solutions.
"What we have got is an agreement here - perhaps for the first time - that the oil price is too high and it is detrimental, it is causing damage and that there must be more investment in the supply of oil immediately and for future years.
"What we've also got is an understanding that we've got to diversify out of oil and we've got to back nuclear, we've got to back renewables."
Mr Brown said Britain had entered into commitments with Saudi Arabia to develop environment-friendly carbon capture and storage technology; with Qatar to explore the possibility of a new joint energy fund; and with the United Arab Emirates to work on opportunities in nuclear energy.
A decision on £800 million of Norwegian investment in the Scira wind farm project off the British coast is expected soon. And he proposed an international conference in London this autumn to follow up on the event and enhance dialogue between oil producing and consuming nations.
