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Is Beijing greedy for oil?
Wenran Jiang, Business Week
Western countries are quick to blame China’s growing energy needs for rising prices. Instead, they should try to capitalize on it with new solutions.
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China’s growing appetite for energy has caused widespread concern in the West. The Middle Kingdom is blamed for the sharp increase in global oil prices in the past few years. Meanwhile, the U.S. is uneasy about Beijing’s cozy relations with major oil producers such as Iran, Saudi Arabia, Sudan, and Venezuela — some of which are hostile toward Washington. Some strategists think China’s vast energy needs could eventually be a security threat in a world of diminishing resources.
That kind of talk creates plenty of resentment within the top echelons of Chinese President Hu Jintao’s government. For one thing, China is paying a huge energy bill for a still-developing economy, a point not always recognized in the West.
…If China succeeds in keeping demand for oil from growing at explosive rates, it will be less vulnerable on that point.
It would also help remedy two other problems: China’s serious environmental degradation and grossly inefficient use of energy. China remains the second-largest emitter of carbon dioxide (after the U.S.), while most of its cities and rivers are severely polluted. The mainland burns three times as much energy as the global average — and many times more than industrialized countries — in producing every dollar of gross domestic product. To change that, it is spending $150 billion on renewable and alternative energy projects during the next 15 years.
WORK TOGETHER. Instead of blaming Beijing for its energy demands or containing China as an energy threat, the industrialized countries should try to capitalize on China’s need for new technologies that promote energy conservation and efficiency, environmental protection techniques, and renewable and alternative energy production. China also needs to be engaged in joint-efforts to manage global warming.
A cooperative approach in solving common energy security issues between China and the West will moderate Beijing’s foreign policy behavior, making it easier to work out tough issues such as the ongoing Iranian nuclear crisis. Yet all this depends on some clear thinking in the West about what really drives Chinese behavior when it comes to energy security.
Wenran Jiang is a professor of international political economy and director of the China Institute at the University of Alberta, Canada. He can be reached at: wenran.jiang@ualberta.ca
(27 February 2006)
A Shell of itself
Nelson D. Schwartz, Fortune Magazine
It should be the best of times for the energy giant. But a look at its reserves show Royal Dutch Shell may soon be running on empty.
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Judging by the $23 billion it earned last year, these should be the best of times for Shell, the Anglo-Dutch energy giant that ranks third among the top five Western oil companies. But Wall Street isn’t celebrating. Instead, analysts are worried that buried beneath the record profit figures are worrying signs of a business in decline.
That’s because Shell (Research) hasn’t been able to find nearly as much oil and gas as it’s now pumping out of the ground. In fact, it hasn’t even come close — replacing only 60 percent to 70 percent of what it produced in 2005 and only 19 percent in 2004. Shell has had reserve problems for years — a controversy over improperly booked assets forced it to reduce estimated reserves by roughly 30 percent and led to the resignation of its CEO, Phil Watts, in 2004.
(27 February 2006)
UK energy minister attacks 4×4 owners
Ros Taylor, The Guardian
The energy minister, Malcolm Wicks, said today he wants to move against the “crass irresponsibility” of drivers of petrol-guzzling 4×4 vehicles.
Mr Wicks told the Times he would like British and European car manufacturers to follow the lead of Toyota, the Japanese manufacturer of the Prius hybrid vehicle. The government offers Prius buyers a £1,000 subsidy, but the energy minister said that was no longer enough, hinting that car companies might be given incentives to invest in developing greener vehicles.
“Given the very demanding CO² cuts we must make, we are going to need more than just a series of marginal changes,” Mr Wicks said. “There will come a time when it will be irresponsible for those [4x4s] to be on sale.”
(27 February 2006)
al-Qaida threatens to hit more Saudi sites
Donna Abu Nasr, Associated Press via Yahoo!Newsw
MANAMA, Bahrain – Al-Qaida suicide bombers will attack more Saudi oil facilities, the terror group purportedly threatened Saturday in an Internet statement that claimed responsibility for the foiled attack on the Abiqaiq plant in eastern Saudi Arabia.
Two suicide bombers tried to drive cars packed with explosives into Abiqaiq, the world’s largest oil processing facility, on Friday afternoon, but security guards opened fire and the vehicles exploded outside the gates, killing the bombers and fatally wounding two guards.
…Saudi Oil Minister Ali Naimi quickly said the attack “did not affect operations” and that exports continued to flow. But the blast made the price of crude oil jump by more than $2 a barrel on the world markets.
(25 February 2006)
Article has background information on the attacks.
Iraq: What civil war could look like
Steven R. Weisman, NY Times
TWO days of mob violence last week after the bombing of a revered Shiite shrine did not simply aggravate Iraq’s sectarian hatreds. Like a near-death experience, the carnage seems to have shocked Sunni and Shiite leaders into a new realization of what civil war would cost, and new efforts to avoid it.
But what happens if such efforts — and frantic ones by Americans — prove incapable of stopping an all-out war?
What if, as Abraham Lincoln famously said of America’s greatest ordeal: “All dreaded it, all sought to avert it … And the war came.”
The greatest fear of leaders throughout the Middle East is that an unrestrained civil war, if it ever comes to that, would not only give birth to warring Sunni, Shiite and Kurdish enclaves inside Iraq, but that the violence could also spread unpredictably through the region.
(26 February 2006)
