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  Wednesday  February 4  2004    02: 33 AM

oil

U.S., China Are on Collision Course Over Oil

 

 
While the U.S. is absorbed in fighting the war on terror, the seeds of what could be the next world war are quietly germinating. With 1.3 billion people and an economy growing at a phenomenal 8% to 10% a year, China, already a net oil importer, is growing increasingly dependent on imported oil. Last year, its auto sales grew 70% and its oil imports were up 30% from the previous year, making it the world's No. 2 petroleum user after the U.S. By 2030, China is expected to have more cars than the U.S. and import as much oil as the U.S. does today.

Dependence on oil means dependence on the Middle East, home to 70% of the world's proven reserves. With 60% of its oil imports coming from the Middle East, China can no longer afford to sit on the sidelines of the tumultuous region. Its way of forming a footprint in the Middle East has been through providing technology and components for weapons of mass destruction and their delivery systems to unsavory regimes in places such as Iran, Iraq and Syria. A report by the U.S.-China Economic and Security Review Commission, a group created by Congress to monitor U.S.-China relations, warned in 2002 that "this arms trafficking to these regimes presents an increasing threat to U.S. security interests in the Middle East." The report concludes: "A key driver in China's relations with terrorist-sponsoring governments is its dependence on foreign oil to fuel its economic development. This dependency is expected to increase over the coming decade."

Optimists claim that the world oil market will be able to accommodate China and that, instead of conflict, China's thirst could create mutual desire for stability in the Middle East and thus actually bring Beijing closer to the U.S.

History shows the opposite: Superpowers find it difficult to coexist while competing over scarce resources. The main bone of contention probably will revolve around China's relations with Saudi Arabia, home to a quarter of the world's oil. The Chinese have already supplied the Saudis with intermediate-range ballistic missiles, and they played a major role 20 years ago in a Saudi-financed Pakistani nuclear effort that may one day leave a nuclear weapon in the hands of a Taliban-type regime in Riyadh or Islamabad.
 

 
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