MOSCOW, Feb 11: US Treasury Secretary John Snow said on Saturday that high energy prices are a risk to the global economy, as finance ministers from the Group of Eight (G-8) countries focused on ways to defuse the threat from persistently high oil and gas prices.

Volatile energy prices have pre-occupied the finance ministers in their meetings over

the past several years. Past statements have emphasized raising investment in production, curbing consumption and making oil market data on reserves and inventories more transparent.

Snow said Russian Finance Minister Alexei Kudrin was right to put a heavy emphasis on energy prices in the meetings in Moscow, the first to be hosted by Russia as the G-8’s new chairman.

“There are many sides to energy security, but, as finance ministers, we emphasized market-based solutions, transparency, and the institutional framework necessary to encourage a friendly investment climate in energy development and infrastructure,” Snow said.

“We are all concerned about the risks of rising energy prices and what this could do to growth,” he said. The ministers had “very useful discussions on energy security,” he said.

Snow said he briefed ministers on President George W Bush’s plans for increasing investment and research in clean-burning fuels. He also noted that costly energy is a particular problem for developing countries.

Snow alluded to another long-standing risk faced by the world economy: large-scale trade imbalances.

Last week, the US government reported its trade deficit grew to a record $725.8 billion (euro606.3 billion) in 2005 and many economists worry the deficits are unsustainable and could lead to volatility of currency and bond markets.

The Bush administration has blamed diverging growth rates between the US and its major trading partners over the past decade for the chasm.—AP