Factors Influencing China’s Oil Diplomacy in the Middle East

Abstract

Even though China extracts oil more than any other country in the Asia-Pacific region, the country is still hugely dependent on imports, and this dependence increases with each passing year. In recent years, the need for import of oil in China had risen from 35% in 2000 to 70% in 2017. Today, the People’s Republic of China mainly buys crude oil in the Middle East and political change in the region directly influence on Chinese foreign policy. In this study, we examined four critical factors that influence china’s oil diplomacy in the Middle East. Accordingly, Arab spring events, OPEC, China foreign policies and strategies, and influence of the U.S. in the region have direct or indirect effects on china’s oil diplomacy. China’s historical reaction to these factors is remarkable and made its energy security strategies in the Middle east. This study shows that the events of the Arab Spring hurt China’s oil diplomacy with the middle East countries. The developments taking place in the Middle East from the beginning of the Arab Spring have led to an increase in world oil prices. For China, this meant higher import bills and a reduction in the trade surplus, as well as slower economic growth, as the contribution of net exports decreased. OPEC market controlling strategies let China thinks to other oil producers, and oil exports from the Middle East reduced in front of increasing imports from other regions. U.S. as hegemon of the area somehow made steady pressure on China alliance, especially after making sanctions on Iran due to its nuclear programs. During the trade war between the two countries, the influence of the U.S. on China oil diplomacy more appeared.

The Bri and Its Implications for China’s Energy Security: The Four as Model Perspective

“…During the recent years, the imported oil and gas channels have been suffering from changes in geopolitical patterns, rampant terrorist attacks and piracy, and interference by great powers (Kulkarni and Nathan, 2016;Bompard et al, 2017). The political instability of many energy-consuming states, manipulation of energy supplies, competition for energy sources, attacks on supply facilities and incidents, natural disasters, and dependency on foreign countries for oil are considered as the challenges related to energy security (Kisel et al, 2016;Azzuni and Breyer 2018;Madani et al, 2020). Although significant achievements have been made in China's energy development, it should be noted that the contradictions and problems accumulated over the years have become more prominent with the rapid economic and social development.…”

“…9 Along with the China-Russia pipeline, Pakistan's Gwadar Port, a crucial part of the China-Pakistan Economic Corridor (CPEC), will serve as the hub for energy and trade in the region. In addition to connecting the western province of Xinjiang to the free waters in the Indian Ocean, the development of Gwadar will allow China to circumvent the Malacca Strait and transit of goods and energy through CPEC (Gholizadeh et al, 2020). Further, China built a deep-water port in Kyaukpyu in Myanmar, pumping USD 1.5 billion oil and natural gas pipeline to Yunnan in China.…”

“…Because of its geographical location, the Malacca Strait is the gateway for energy flows from the Middle East and Africa to Southeast Asian countries. For energy imports, China relies on the Malacca Strait, leaving it vulnerable to insecurity or other disruption(Gholizadeh et al, 2020). The Strait of Makassar is the only option.…”