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China-Japan Oil Race Inevitable

The race for Russian pipeline and for oil in East China Sea, unveiled the "energy race" between China and Japan to the world. Analyst says the inevitability of the competition has long existed.  

Japan, an economic power poor in energy resources, Japan has to depend on import for almost all energy resources: oil, coal and natural gas. According to authoritative statistics, averagely Japan imported daily almost four million barrels in 2002 and over 4.5 million in 2003. The fact is that its unduly heavy dependence on oil, more than 50 percent of its total energy consumption, has been a serious limitation.


The limitation has long pushed Japan into the international energy market. To date, Japan has left its steps among the newly discovered oil fields including those in Western Serbia, Caspian Sea, Middle Asia and North Africa. With its economic and technological advantages and through purchase and merging etc, Japanese enterprises such as Mitsubishi have settled down, acquiring large amount of the oil around the world.


Japan has been kept on edge by China's increasing oil demand in the past two years. Objectively speaking China is a country with relatively rich energy resources. However, in terms of make-up, China is currently rich in coal but short in oil and gas. China's oil consumption has been growing at an annual rate of around six percent over the past decade while that of the output was only 1.5 percent. However, China surpassed Japan to be the second oil importer in the world.


An indisputable fact is that both China and Japan are confronted with the same scarcity of energy and a surprising convergence.


Files say that presently, the provision from the Middle East accounts for 50 and 87 percent of total imports of China and Japan respectively and the route is the same: through the Strait of Malacca, South China Sea to the two countries.


Analyst points out the converging dependence on foreign supply, the same sources of oil and gas import, plus relativity in geopolitics and geoeconomics all inevitably lead to China-Japan competition in the international oil market, which will turn more fierce and cruel as China's four big oil companies go overseas.


Sources say when China National Offshore Oil Corp. (CNOOC) bought Australian project of Northwest Shelf project, Mitsubishi and Mitsui tried hard to object China's participation. When China National Petroleum Corporation (CNPC) entered Sudan and took the oil pipeline project, it suffered strong objection from Japanese side including government. Moreover, in the international tendering of Iran's oil and gas, Japan again became a major rival of CNPC.


It is no exaggeration that Japan is almost shadowing China wherever there is oil.


Concerning the conflict, China Business Times comments that the competition for Russian pipeline and exploration in East China Sea, is only a prelude of the game between China and Japan in the arena of international energy.


Zhang Qiyue, spokesperson of China's Foreign Ministry, told a press conference recently that China and Japan have both expounded their stances and related concerns on the demarcation of East China Sea. Both sides think that different views do exist and advocate seeking a just solution of the problem through negotiations on the basis on the United Nations Convention on the Law of the Sea.


Correspondent found that the issue concerning East China Sea is so complicated that high-level officials of China and Japan failed to make a breakthrough on significant questions therefore consultations will continue.


(People's Daily October 29, 2004)

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