Oil Supply Routes in the Asia Pacific: China's Strategic Calculations

Oil Supply Routes in the Asia Pacific:
China’s Strategic Calculations
Abstract
The purpose of this paper is to re-examine the existing critiques of China's oil
supply diversification strategies in the Asia Pacific. It deconstructs the growing
energy relationship between China and the Middle East that has made the
security of the Hormuz Strait and the Malacca Strait vital to China's energy
security. It analyses specific geographic and strategic chokepoints in China's oil
supply route and concludes that supply diversification motivations are driven by
the nation's political economy and military strategy.
Introduction
Energy security forms the backbone of most economic and political
policies of nations around the world. China is no exception and is
increasingly following a multi-pronged global strategy—one where its
economic priorities do not necessarily overlap with its foreign policies. This
has enabled China to interface with a wide range of nations and businesses
to secure its interests in energy all around the world, particularly in oil.
In 1993, China went from being a net exporter of oil to a net importer.
According to the National Development and Reform Commission, China's
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energy consumption increased by 5.6% annually from 1980-2006 . It is the
second largest consumer of oil after the United States and is set to overtake
it within a decade. Today oil remains a resource without many practical
substitutes for many of its end uses. Figure 1 shows the exponential growth
in the consumption of oil in China, while oil production remains almost
stagnant. This has left a big supply gap which is addressed through increased
imports–emphasising the need for the country to ensure secure and
efficient supply channels.
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