Energy security guides China on Gaza
By Antoaneta Bezlova
BEIJING - China's pro-active stance in finding a settlement to the latest
crisis in the Middle East - a trouble spot which does not normally figure on
Beijing's list of top foreign policy priorities - suggests heightened attention
to energy security for the country's power-hungry economy.
Joining the calls for an immediate ceasefire in the Gaza Strip, China announced
it will be sending its Middle East special envoy to Egypt, Israel and Palestine
to promote conflict resolution.
Beijing has also pledged US$1 million of emergency humanitarian
aid to the Palestinian National Authority and promised it will send more in the
future.
"We grieve over the deteriorating humanitarian crisis in the Gaza Strip,"
Foreign Ministry spokesman Qin Gan said at a press briefing. "We appeal to
relevant parties to immediately stop military actions."
Chinese leaders have expressed concern about the worsening armed conflict in
the region.
Chinese President Hu Jintao held a telephone conversation with US President
George W Bush after the conflict broke out and Foreign Minister Yang Jiechi has
also spoken, via telephone, with US Secretary of State Condoleezza Rice.
The conflict overshadowed China's celebrations of the 30th anniversary of
establishing diplomatic relations with the United States. Because of the
Israeli-Hamas violence, Rice cancelled her trip to Beijing to attend the
celebrations last week, bringing to the fore the importance Washington attaches
to the situation in the Middle East.
"China is an emerging economic power and has to push for increasing its
influence in the Middle East," said independent energy analyst Liu Tao.
"Participating along with other world powers in the resolution of the current
conflict in the region can help China better ensure its energy security."
Although a relatively new player in the Middle East, in recent years China has
invested diplomatic efforts into cultivating relations with countries in the
region. While seeking to carve out a space for itself in a region traditionally
dominated by US and British influence, Beijing has concentrated on upgrading
economic ties.
Arab countries are currently China's eighth-largest trading partner. In the
Middle East, and in the Persian Gulf in particular, China is no longer viewed
just as a source of low-priced consumer goods but mainly as a major market for
oil.
Securing access to oil is what has underpinned Beijing's charm offensive in the
region since the country became a net oil importer in 1993. Today, more than
50% of China's oil imports come from the Middle East.
The country's energy officials have adopted a strategy of energy
diversification, working to secure concessions and investments in oil and gas
fields in other resource-rich countries like Venezuela and Nigeria.
Yet the bulk of China's oil imports remain dependent on the Middle East which
holds two-thirds of the world's proven oil reserves.
The International Energy Agency predicts that Chinese oil imports from the
Middle East will rise to at least 70% by 2015, underscoring that the prospects
of maintaining high growth for the Chinese economy are inextricably tied to the
fortunes of the Middle East.
While the current crisis does not involve major oil-producing countries in the
region, Chinese energy analysts have pointed at its impact on oil prices.
Worries that the armed conflict could engulf the oil-rich Middle East, had
helped push oil prices to $48 per barrel last week.
"The conflict is a godsend for those hoping that oil prices will bounce back to
some more acceptable level," said Dong Xiucheng of China University of
Petroleum in Beijing.
For China, however, the conflict may bring disruption to recently announced
plans to stockpile oil. Amid low international oil prices Beijing has been
seeking to fill up its strategic oil reserves, quickening the pace of its
imports.
While China does not disclose its oil inventories on a regular basis, it has
been upgrading its existing storage facilities and building new ones.
The country's plans to create strategic oil reserves came to a halt after oil
prices hit $70 a barrel in August 2007. Analysts believe Beijing resumed
filling up the reserves in the last few months, taking advantage of falling
global demand for energy.
In early January, Zhang Guobao, head of the National Energy Administration, was
quoted by the People's Daily newspaper as saying that China will "encourage
companies to utilize idle storage capacity to increase oil inventories".
That followed news that the US was seeking to buy as much as 20 million barrels
of oil for its emergency stockpile while the low prices held.
Some Chinese newspapers have speculated that the conflict and its
"price-inflating" effects were timed as a "parting gift" by the "Bush dynasty"
to the US oil majors. "The traditional mode of crisis the region has slipped
into cannot disguise the war over petrol that is going on," claimed a
commentary in the China Times.
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