Japan Press Weekly

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2007 December 5 - 11 [ECONOMY]

JCP requests government to take urgent measures to deal with rise in oil prices

The Japanese Communist Party Dietmembers’ Group on December 4 made representations to Chief Cabinet Secretary Machimura Nobutaka requesting the government to urgently take measures to protect the people’s living standards from being adversely affected by the sharp increase in oil prices.

Pointing out that the influx of hedge funds and other types of international speculative funds has caused the sudden rise in oil prices, the JCP demanded that the Japanese government make an all-out effort to establish rules to regulate speculation and secure stable energy supplies in cooperation with other nations.

The JCP called on the government to take urgent measures to strengthen monitoring of corporate attempts to use oil price hikes to raise prices of oil products, foods, and daily commodities, secure the heating oil supply and slash its price, instruct major oil distributors to return their profits to consumers, and release domestic oil reserves.

The JCP representatives also urged the government to drastically change environmental and energy policies in order to reduce Japan’s dependence on oil, and look into how the skyrocketing oil prices are affecting the living conditions of the general public.

Machimura said that the government is also planning to compile its measures to deal with the issue as soon as possible, adding, “We will take note of your suggestions.”

The following is the gist of the statement the JCP Dietmembers Group submitted to the chief cabinet secretary:

The steep rise in oil prices is adversely affecting the living conditions of the general public and local economies, posing a serious problem for the future of the Japanese economy as a whole.

Compared to the beginning of 2004, the gasoline price is now 50 percent higher, light oil price is 60 percent higher, and kerosene and heavy oil prices are twice as high. Those price hikes have been directly affecting farmers using greenhouses, fishers, and owners of truck transportation businesses, service stations, dry cleaners, and public baths.

It has also brought about major adverse influences on people’s livelihoods. In addition to the jump in the gasoline price, the rise in the price of heating oil has become a crucial issue to residents in northern parts of the country who face severe winter weather.

Coupled with higher costs for raw materials and grain, the sharp rise in oil prices has also caused increases in the prices of daily necessities and food, including bread, instant noodles, miso (soybean paste), beer, and tofu (bean curd), and is leading to a rise in overall consumer prices.

The six major oil companies in the last three and half years have made a profit of 2.6 trillion yen. Amid the record profits made by them and other major corporations, public anger at and distrust of the government is expanding because of its failure to take effective measures without delay.

Today, the government must take the influx of international speculative funds seriously as a major cause of recent sudden rise in oil prices.

It is obvious that the vast amount of speculative funds in oil and grain markets with the aim of making short-term profits is a causal factor in the sudden rise in prices.

These speculative funds along with the big financial institutions manipulating them are making enormous profits by the violently fluctuating market prices.

Food and energy are the basis for human existence and economic activities and must not be left to the “market forces” and “money games” under the control of large-scale international speculative funds.

Now is the time for the Japanese government to cooperate with other countries to establish rules to regulate such international speculation and to ensure a stable oil supply.

Domestically, due to the series of government measures to promote deregulations and liberalization, two major oil distributors, Nippon Oil Corporation and Japan Energy Corporation, have achieved an oligopoly in the oil products market. The government must impose strict monitoring to prevent market manipulation and unfair trading as well as the increase in prices of food products and other daily necessities.

The Japanese Communist Party Dietmembers’ Group strongly requests the government to take urgent and drastic measures to protect people’s livelihoods and small- and medium-sized businesses that are facing enormous difficulties amid increasing poverty and social disparities. - Akahata, December 5, 2007