Government should take up an initiative to set up syndicate of oil consuming countries to lobby for price band mechanism to deal with rising crude oil prices, said a survey of 300 CEOs of top Indian companies.

Oil consuming nations should form a syndicate for collective bargaining in crude oil prices, which would strengthen their position in the crude market, the survey by industry body Assocham said.

About 83 per cent of the business leaders agreed that India along with other developing nations should stress on the need for price band mechanism in oil trading, Assocham President Sajjan Jindal said.

The unabated rise in global crude prices has become a double-edged sword for oil importing nations that are facing huge import bills, impacting their balance of payment and widening trade deficits, Jindal said.

International crude oil prices have shot up by 100 per cent in the last one year touching over 145 dollar per barrel.

The rising price is attributed to factors like weakening dollar, speculation in oil markets, increased demand from China and India and pressure on the US refiners to increase production of new gasoline, the survey said.

Majority of the CEOs said oil prices are moving upwards due to speculative activity rather than real productive demand.

Oil-consuming nations also need to step up investments in alternative renewable sources of energy, the survey said.

Trade commission and commodity exchanges in countries should investigate market manipulation in oil futures to control any further hike, it added.

The price rise is impacting growth rates of developing countries as high inflation and unemployment rates are forcing the central banks to hike interest rates.

About 89 per cent of CEOs said due to this rise, the developing nations, which still have considerable population below poverty line, would have to cut expenditure on developmental programmes affecting poverty removal, employment generation and social betterment schemes.