The sharp rise in oil prices poses a risk to the global economy unless producing countries live up to their responsibilities, the European Central Bank (ECB) warns today.

The euro-zone's central bank is keeping the door open for a further interest rate cut if needed to bolster continental Europe's stuttering upturn.

In an interview with the Financial Times ahead of this weekend's meeting of the Group of Seven industrial countries, Mr Jean-Claude Trichet, ECB president, warns that rising energy prices are a "highly unwelcome phenomenon" for growth and inflation.

In a thinly veiled criticism of the Organisation of Petroleum Exporting Countries (OPEC), which has cut its supply ceiling to support petroleum prices, he urges the cartel to be "fully up to its responsibility", adding: "We all have a stake in global prosperity."

Separately, Mr John Snow, US Treasury secretary, has dismissed concerns that the US budget deficit poses a threat to global economic growth as "misguided".

Writing in today's Financial Times, he says: "We acknowledge that it is too large and we are committed to reducing it dramatically, but those who point to our budget deficits as a threat to global prosperity are misguided in their thinking."

The US deficit, the euro-zone's faltering economy and world oil prices are all likely to figure at this weekend's G7 meeting.

In his article, Mr Snow steps up pressure on the G7 nations "to make the lasting changes" - cuts in tax rates and labour market reforms - needed to deliver stronger global growth. - (Financial Times Service)