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THE NEW SILK ROAD: CHINA’ ENERGY POLICYAND STRATEGY IN THE MENA REGION
SBE, Vol.20, No.1, 2017
ISSN 1818-1228
©Copyright 2017/College of Business and Economics,
Qatar University
is, however, still a major producer of oil (and
other natural resources). China holds Asia’s
largest oil reserves
7
.The problem is that its
demand is so high and increasing, China still
needs to import oil because its own reserves
are not sufficient. Datta and Vigfusson fore
see that due to its size and rapid economic
growth, China will continue to be of primary
importance in determining the path of global
oil demand . China’s future demand for oil
will depend on both its economic growth and
its energy choices. A high level of growth
combined with energy -intensive choices could
result in Chinese oil demand doubling by 2025.
Even in a scenario with more moderate growth
and less energy-intensive choices, China’s
oil demand would still grow by over 30% by
2025
8
.
In 1959, the discovery of the Daqing oilfield
in Chinese territory had initially reassured
China that oil supply would not be an issue
for the Chinese economy and would help
maintain self-sufficiency. However, due
to intense economic growth in the 1970s,
China became an importer of oil by 1993
9
.
In addition, reformist leader Deng Xiaoping
was convinced that the only path forward for
China was economic modernization—which is
fuelled by petroleum—and made his idea the
centerpiece of China’s domestic and foreign
policy
10
. According to the International
7 Daojiong Zha and Meidan Michal, China and the Middle
East in a New Energy Landscape, The Royal Institute of
International Affairs, 2015. Pge 26
8 Datta D Deepa and Vigfusson Robert J.,
Forecasting
China’s Role in World Oil Demand,
FRBSF
Economic Letter , Research from Federal Reserve Bank
of San Francisco,2017. Pg 5
9 Sager, A. “GCC-China Relations: Looking Beyond
Oil-Risks and Rewards,” in
China’s Growing Role in the
Middle East: Implications for the Region and Beyond
.
Eds. A. Sager and G. Kemp. Washington, DC: The Nixon
Center. (2010)
10
Shirk
,
S. L.
How China Opened Its Door: The Political
Success of the PRC’s Foreign Trade and Investment
Reforms.
Brookings. (1994); Olimat Muhammad S.,
Energy Agency (IEA), China’s oil demand
reached 10-12 million barrels per day in 2017
11
and Bloomberg reported in 2013 that China
had overtaken the United States as the world’s
highest energy-using economy, with imports
and exports reaching $3.87 trillion USD
12
.
Similarly, British Petroleum Statistical Review
of World Energy 2014 indicates that China
was the world largest producer and consumer
of energy overall in 2013
13
. However, China
only produces 44 percent of the oil it needs
14
.
As energy shortfalls could slow down and
even stop China’s growing economy, China’s
top priority since the 1990s has been to
secure steady foreign oil supplies to fuel its
economy
15
.
With its large oil reserves and its geographical
proximity to Asia, the Middle East is a logical
candidate to sustain Chinese economic growth.
The Asian continent imports more crude oil
than any region in the world and is currently
the single most important market for Persian
China and the Middle East:
From Silk Road to Arab
Spring,
Reprint Edition, NewYork, Rougtledge, 2015. Pp.
53
11 Gross Samantha, Lower for Longer: The Implications
of Low Oil and Gas Prices for China and India , Foreign
Policy At Brookings. 2017, pg 17)
12 Bloomberg Business., “China Eclipses U.S. as Biggest
Trading Nation.”(2013) [Online] Available from: http://
www.bloomberg.com/news/2013-02-09/china-passes-u-s-to-become-the-world-s-biggest-trading-nation.html
[Accessed 21 November 2015].
13 British Petroleum. Statistical Review of World Energy
Workbook, Oil: Trade Movements, Statistical Review of
World Energy Workbook. London. (2014)
http://www.bp.com/en/global/corporate/about-bp/energy-economics/statistical-review-of-world-energy/review-by-
energy-type/oil/oil-trade-movements.html [Accessed 21
November 2015].
14 Al-Tamimi, N. “China-Saudi Arabia Relations:
Economic Partnership or Strategic Alliance?” Durham:
Universitty of Durham (
HH Sheikh Nasser al-Mohammad
al-Sabah Publication Series 2
).(2012).
15 Alterman, J. and Garver, J. (2008).
The Vital Triangle:
China, the U.S., and the Middle East.
Washington, D.C.:
CSIS Press. (2008)