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Niklas Swanström
This is the first issue of the CEF Quarterly under new directorship. The former editors, Matthew Oresman and Malia Du Mont have stepped down. We are very grateful for their work and will try our very best to continue the success of the China and Eurasia Forum. Besides ensuring the quality of the CEF, we would also like to explore new ways to reach out to our members and to make news and information on China-Eurasia more accessible. Since taking over, we have developed the homepage and introduced a weekly newsletter for our members. Readers are invited to visit our homepage and utilize the news archive. Concerning the CEF Quarterly, we decided on a topical approach so that every issue would cover a particular topic in-depth, even if we still accept interesting off-topic articles (...)
East Asia and the Middle East: A Fateful Energy Embrace
Kent Calder
Two thousand years ago China’s Han dynasty traded extensively with Persia and Mesopotamia. For fifteen centuries a vigorous trade in silk, spices, and a variety of manufactures continued. In the past decade Beijing, Dhahran, Abadan, Mumbai, and Yokohama have grown ever more connected once again. The catalyst this time is energy. Across the vast swath of Asia south of Sakhalin, east of Xinjiang, and north of Sumatra—home to over a quarter of humanity—there is only one major oil field—Manchuria’s Daqing. And that is rapidly declining toward depletion. Japan, Korea, and Taiwan have virtually no on-shore domestic oil or gas reserves at all (...)
Quest for Oil and Geostrategic Thinking
Ingolf Kiesow
The production levels of oil and gas in China, India and the United States are either in decline or have stagnated. Meanwhile, the level of energy usage has dramatically risen in these countries. This has created a deficit between local production and domestic usage which in turn, has to be covered through the import of oil and gas. However, the search of such overseas energy resources is increasingly taking on a competitive streak. Tension has been building, especially in Asia, as the race to secure oil and gas abroad heats up (...)
China’s Energy Dependence on the Middle East: Boon or Bane for Asian Security?
Phar Kim Beng and Vic Y.W. Li
Going strictly by its current energy usage and profile, China’s coming over-dependence on oil from the Middle East is not necessarily a given. According to sources culled from the International Energy Agency (IEA), China will import 5.9 to 6.9 million barrels per day (b/d) in 2020, constituting 63 to 70 percent of total oil consumption. In contrast, the Chinese observers put such imports at a lower figure between 3.6 to 5.0 million b/d in 2020, which translates into 46 to 54 percent of oil consumption. In any case, with oil share in the energy mix projected to increase slightly from 25 percent in 2000 to just 27 percent in 2030 it can only remain as China’s second most important fuel over the next two decades (...)
China’s Energy Asset Acquisition Policy Abroad: From Shopping Spree to Fire Sale?
Maria Kielmas
China’s determination to acquire energy assets around the world has given rise to the assumption that its appetite for such resources may be limitless. The country’s oil demand has been forecast by the Paris-based International Energy Agency (IEA) to rise from 6.5 million barrels per day (mb/d) to over 14 mb/d by 2025. It has been said that China’s acquisition of energy assets in Central Asia and the growing influence of the Shanghai Cooperation Organization (SCO) is set to increase China’s influence in the region. While most commentators have focused on how such a development is likely to be a source of growing tension between China and the United States, the hitherto ignored factor is whether these acquisitions are profitable and sustainable in the long term (...)
The New Natural Gas-Based Technologies in the Context of Northeast Asia
Vladimir I. Ivanov
All economies, including those in Europe and East Asia, are now facing the linked challenges of energy security, rising energy prices and climate change. These challenges all point in the same direction: the need for an increased emphasis on energy efficiency and on the de-carbonization of energy sources. Achieving these goals, in a way that enhances growth and competitiveness, will require (1) new investment and technological advancement, (2) the development and use of the most cost effective regulatory mechanisms, and (3) coordinated international efforts (...)
China’s Energy Security and the East China Sea
Arthur S. Ding
On September 9, 2005, five Chinese warships were found patrolling in the water area close to China’s Chunxiao gas field in the East China Sea. Among the five was a Russia imported Sovremenny class missile destroyer. This was the first time Chinese warships have been seen in the area. Several days later, a Japanese P-3C reconnaissance aircraft patrolling in the same area was reportedly locked by a Chinese warship’s radar. Most recently in October, a Chinese electronics warfare aircraft was found flying over this area. The increased military activity in the East China Sea over disputed oil and gas fields has led to growing speculation about the possibility of conflict erupting in this area between Japan and China in the near future (...)
China’s Energy Security and Its International Relations
Zha Daojiong
Contemporary China began with an ambitious goal of rapid industrialization and modernization but a very low base of oil production and consumption. In 1959 China’s crude oil production stood at 3.73 million tons (Mt). It was only in 1963 that China ended its century of dependence on imported oil and oil products. In that year, the Daqing oil field in Northeast China produced 4.3 Mt of crude, making up the bulk of the 6.48 Mt of nationally produced oil. From the 1950s to the early 1970s, China was self-sufficient in energy. But its international relations prevented that self-sufficiency from serving the country’s goal of economic and social development (...)
The Dilemmas of China’s Energy Governance: Recentralization and Regional Cooperation
Gaye Christoffersen
Before 2003, Sino-Japanese-Russian energy relations held promise of multilateral cooperation, yet in the last two years, cooperation turned to competition as China and Japan promoted alternative oil pipeline projects to Moscow. The rivalry began with an oil pipeline from Angarsk, shifted to the East China Sea dispute over the Senkakus/Diaoyutai, and threatened to spread into further issues and spiral out of control. The image of Chinese competitive behavior was fueled by the Going-Out Strategy of the Chinese national oil companies—China National Petroleum Corporation (CNPC), China National Offshore Oil Corporation (CNOOC), China Petrochemical Corporation (Sinopec)— collectively referred to as the National Oil Companies (NOCs) (...)
An Asian Oil and Gas Union: Prospects and Problems
Niklas Swanström
Eurasia, herein defined as Northeast and Central Asia, has been ravaged by historical and current conflicts of both military and political nature, such as Japan or Russia’s occupation of their neighbors, border disputes etc. This has created an environment where there is a chronic lack of trust among the regional actors and relations are often seen as a zero-sum game, or in relative gains. From an international perspective, it is symptomatic that there is very little cooperation in the military and political fields (...)
China, Kazakh Energy, and Russia: An Unlikely Ménage à Trois
Stephen Blank
On the face of it China should not encounter unusual difficulties in buying equity stakes in Kazakh energy assets that are for sale on the market. Both states are members of the Shanghai Cooperation Organization, bilateral trade is steadily growing, and Russia and China are very clearly strategic partners who are uniting against the American military-political presence in Central Asia. Yet China has met with every conceivable kind of obstacle to the objective of obtaining reliable supplies from and access to Central Asian, and especially Kazakh, energy sources (...)
The Dragon and the Magi:Burgeoning Sino-Iranian Relations in the 21st Century
J. Brandon Gentry
Over the last several years, China and Iran have significantly strengthened their bilateral ties, reaching out to one another on issues ranging from energy and nuclear proliferation to trade, tourism, and military cooperation. With a relationship bolstered by a shared suspicion of U.S. interests, China’s ever-growing thirst for energy resources, and Iran’s desire to maintain its position as a Persian Gulf powerhouse, the Sino-Iranian partnership looks to move forward at a steady pace into the foreseeable future (...)
Japan’s Central Asia Diplomacy: Motivations, Implications and Prospects for the Region
Christopher Len
Following the collapse of the Soviet Union in 1991, five new independent republics emerged in the Central Asian region. In the early days as young independent republics, these states had very little economical experience, financial reserves, international diplomatic exposure, and national identity consciousness to speak of. On the domestic front, there were worries about social disruption and political collapse, of conservative Islam sweeping into power, of ethnic strife erupting, territorial disputes with neighbors descending into conflict, as well as environment degradation. Read more
