China’s Global Search for Energy

Whether by diplomacy, investment or in extreme cases, force, China is going to great lengths to satisfy its growing hunger for energy to fuel its expanding car fleet and electrify its swelling cities.

The Chinese government showed that desire on Wednesday when it reached a 30-year natural gas deal with Russia, even as China was locked in a tense standoff with Vietnam over a Chinese oil rig drilling in the contested South China Sea.

The two events involve different political dynamics.  The agreement with Russia reflects closer economic ties between the two nations, while the other underscores the growing tension of two on-again, off-again Cold War allies.

But both developments demonstrate China’s expansive approach to energy, a political and economic strategy with significant implications for the rest of the world.  As its economy has rapidly expanded over the last decade, China’s energy efforts have come to dominate the global markets.  Its mushrooming consumption helped prompt the spike in global oil prices in the mid-2000s.

China’s demand has also provided life support to coal producers suffering from declining use in the United States and other industrialized countries.  Among the fastest-growing importers of natural gas, China has had to cement its ties to Russia to diversify its supplies, as well as to invest in exploration in the United States and liquefied natural gas terminals in Australia.  China now has operations, investments or projects across the globe in Africa, the Middle East, South America and North America.

China’s Global Search for Energy