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Cabinet takes bold steps to cut energy consumption

Lower speed limits approved in bid to combat oil price rises

In steps unseen since the world energy crisis of the 1970s, the Cabinet on Friday agreed to lower highway speed limits and cut train ticket prices as offset measures to deal with soaring oil prices fueled by the unrest in Libya.

Deputy Prime Minister Alfredo Pérez Rubalcaba said the maximum speed limit on highways will come down from its current level of 120 kilometers per hour (75 mph) to 110 kph (68 mph). The new limit will go into effect on March 7.

The government also approved a five-percent reduction in fares on Renfe commuter and middle-distance trains.

"We are going to wage a major campaign to promote the use of public transportation, which we always welcome, but in this case, makes it absolutely necessary for us," Pérez Rubalcaba said.

Despite shutdowns by oil companies operating in Libya, Spain's energy supply is not in danger, the deputy prime minister said. But he prediced that energy bills will rise significantly because of the sharply higher oil costs.

Petroleum prices closed on Friday at $112 a barrel, down from $120 a barrel the day before. Rubalcaba said the 10 euros per barrel extra Spain will have to pay will cost the country an extra 500 million eurosper month.

Spain gets more than 80 percent of its energy needs from outside resources. Last year it imported 25.51 billion barrels of oil, 10.3 billion more than the previous year.

In a related issue, Amnesty International also denounced that the Spanish government has sold close to 7 million eurosin arms and weapons to Libya over the last several years.