I’m delighted to be leading the new Department of Energy and Climate Change, which has been created to give an even greater focus to solving the twin challenges of tackling climate change and securing an affordable energy supply.

Over the last couple of years, and in particular over the last few months we have seen dramatic changes in oil prices. Oil price volatility has an impact across all levels of society, often hitting the most vulnerable hardest. Clearly, a stable oil market is in our common interest and the current economic climate only reinforces this.

This is why the phase of the producer-consumer dialogue that was started at the Jeddah Summit in June is so important. The medium to longer-term challenges facing energy markets that were identified at Jeddah still need to be addressed. If we can improve the way that the oil market functions, with supply and demand responding more efficiently to prices and investments based on shared understanding of future demand and supply conditions, we can reduce the likelihood of price volatility. That will be good for everyone, especially the poor and least developed countries, who are the hardest hit by high energy prices.

Even in a de-carbonising economy, the world will still need oil. So we will continue to need investment in production: both to meet rising demand and offset declines from existing fields.

At the same time we will need to continue to take urgent action to tackle climate change which, if not mitigated, will undermine global growth and security. This will include measures to diversify the energy supply through increased energy efficiency and accelerating the use of low emission technologies. It is therefore vital that producers and consumers work more closely together to understand clearly the outlook for consumption to ensure supply and demand match in a timely manner and at sustainable prices.

At the December meeting we will, working with the IEF, provide a progress report on all the long-term commitments agreed at Jeddah. Broadly these were:

1. Removing barriers to upstream and downstream investment

2. A shared understanding of future supply and demand trends

3. Improving the quality, completeness and timeliness of oil data

4. International progress on increased energy efficiency

5. International support to help developing countries alleviate the consequences of high oil prices.

As well as this, under the wider theme of “Oil, Energy and the World Economy” we will present some analysis of the impact of the financial crisis on energy markets, looking particularly at the effect of the credit crunch on energy demand and investment and what this might mean for energy markets in the future. This will help us all to better understand the effects of the current economic climate and what further work is necessary to achieve our longer-term shared ambitions for the oil market.

I am grateful for the contribution the IEF has made to the preparation for the London meeting and am sure that together we can achieve real progress on 19 December.