Pointing out that fossil fuels are one of the major causes of global climate change, Charles Secrett, Executive Director of Friends of the Earth (FoE), congratulated the Prime Minister for his tough stance. “It’s crucial to keep prices high to combat climate change and meet the UK’s 20% carbon dioxide reduction target.”

“A hydrogen economy, based on fuel-cells powered by renewable energy, is just around the corner,” said Stephen Tindale, Greenpeace Policy Director. “Instead of campaigning for lower fuel prices, haulage companies should be working with vehicle manufacturers and politicians to speed up this transition.”

As protests spread around Europe, putting pressure on EU governments, the European Environmental Bureau (EEB), the largest federation of environmental citizens organisations in the continent, has called on politicians to convert the crisis into an opportunity.

According to the EEB, the real costs to society of the use of petrol are still not reflected in the price. For environmental and related social reasons, such as health and noise (see related story), an ever increasing volume of road and air traffic is unacceptable, says the Bureau.

“It is not so that petrol is now suddenly very expensive,” said Lone Johnsen, EEB President. “It is more so that it has been during long periods irresponsibly cheap, therewith making it difficult to promote other modes of transport, in particular road and waterways. The low prices have also made it profitable to drag goods back and forth all over the EU just because of, for example, some marginal price differences in labour costs for some parts of the production process.”

Instead of decreasing taxes and levies, governments should ensure that the increased tax incomes due to the higher prices for oil products are used to support public and rail-goods transport and energy efficiency measures, says the EEB.

The US is also feeling the effect of recent oil price rises, says the US environmental research organisation, the Worldwatch Institute. On 7 September, oil prices climbed to US$35.39 (£25.13) per barrel, the highest since just before the Gulf war, threatening a world-wide recession, according to Lester R Brown, Chairman of the Worldwatch Institute. Even if OPEC (Organisation of Petroleum Exporting Cournties) ministers decide to boost daily output by the minimum 500,000 requested by oil importing countries, it may be too little too late, says Brown.

“The time has come to restructure the tax system both to reduce the threat of soaring oil prices and to stabilise climate,” said Brown. “We can restructure our tax system by lowering the personal and corporate income tax and offsetting it with an increase in a tax on gasoline.”

“If we take the initiative and raise gasoline taxes while lowering income taxes, the increase in the gasoline tax will end up in our treasury and individuals will benefit from lower income taxes,” said Brown. “But if we don’t restructure and let OPEC countries keep increasing the price of oil, and hence of gasoline, the equivalent of the gasoline tax increase will end up in OPEC treasuries.”

Action inspires action. Stay ahead of the curve with sustainability and energy newsletters from edie