OIL DRILLING SCREW DOWN

Australia is examining rules and regulations for deep offshore oil drilling to screw down safety precautions against oil rig blowouts and other equipment failures.

US President Barack Obama is seeking an international "blanket of support" for rolling back billions of dollars in tax breaks for oil companies and use the money for clean energy research.

The U.S. has put the onus squarely on oil companies to make sure that safety is paramount, particularly in deep waters, which is certain to increase the cost of oil and derivatives.

The longer term effect will be that motorists will be paying more for petrol and those power plants fueled by oil will lift their electricity charges.

The disastrous spill in the Gulf of Mexico is having both political and economic ramifications with BP now under pressure to suspend its dividend, which is due to be paid to shareholders next month so that the company can pay the U.S. billions in compensation for the catastrophe.

As well, the catastrophic spill has given new momentum to climate change legislation, but capping carbon emissions faces a difficult road ahead in the U.S, Senate.

And, in Australia, the emissions trading scheme (ETS) won't be put for Senate approval by the current Labor Government whose Prime Minister Kevin Rudd's is running at an all time since taking office partly because of his about turn on climate change policy.