2000s >> 2003 >> no-1192-december-2003

Out of the ground in Asia

It is plain that the invasion of Iraq was essentially caused by Western capitalism’s desire to control that country’s oil supplies. But the Middle East is not the only area with such resources, and other capitalist powers are keen to get their hands on whatever energy supplies they can.

China, for instance, used to pride itself on its oil industry, with “In industry, learn from Daqing”, referring to a celebrated oilfield, being part of a ubiquitous slogan in Maoist days. Since 1993, however, it has been a net importer of oil, and now imports 30 percent of its requirements. Existing fields are approaching depletion, and on one estimate, by 2020 at least half of the oil it needs will have to be imported. This is problematic for China’s rulers, in terms of both cost and security of supplies.

Hence the interest in exploring and exploiting the Tarim Basin, a vast area located in the extreme west of China, near the border with Kirghistan (see Beijing Review, 9 October). This has both oil and gas, possibly as much as 6 billion tons of the former and 8 trillion cubic meters of the latter. Oil production is already under way, but it is gas that is the current focus of interest. A pipeline, over 4000 kilometers long and costing untold billions of dollars, is being planned to carry natural gas from Tarim to the Shanghai area on China’s eastern coast. Even this, though, is only likely to provide thirty years’ worth of gas supplies.

Meanwhile, oil resources in Russia have also become a subject of dispute. The Angarsk area, near Irkutsk on the shore of Lake Baikal, is at the centre of a sizeable oilfield, and the Russian rulers, relatively strapped for cash as they are, see this as a resource they can sell in return for foreign exchange. However, the amount of oil there is unlikely to be enough to justify more than one pipeline to deliver it to prospective customers, so there is a scramble to see where that pipeline should go. China, of course, wants it to go to Daqing so that its own needs for oil can be met.

But Japan has another idea, a pipeline to Nakhodka, which is in Russia’s far east, just down the coast from Vladivostok and facing Japan. The Japanese Prime Minister visited Moscow in January this year, and the pipeline was one of the items on their agenda. And the United States, not content with getting hold of Iraq’s oil, has its own eyes on what is happening: a pipeline in the other direction to Murmansk, near Russia’s border with Finland, could lead to the oil being exported to the US instead.

Behind all this diplomacy lie two issues, apart from the general one of ensuring access to energy. One is diversification of supplies, so that problems in one area will not lead to a drastic cutback in availability of oil or gas. China, for instance, sees Kazakhstan as another potential supplier, and a Chinese company is already exploring there. Japan currently takes nearly 90 percent of its oil imports from the Persian Gulf area, and this is not a healthy situation as far as Japan’s capitalists are concerned. The other issue is seeking to prevent any one rival country from dominating oil supplies in a particular area. Japan, again, does not want China to control the lion’s share of oil in east Asia. Any country that was in such a situation of dominance would quite likely have the whip-hand over its competitors.

The availability and sensible use of energy is an issue for any society. But under capitalism, questions of strategy and inter-nation rivalry far outweigh environmental and other concerns. We cannot predict whether there will be an Oil War in central or eastern Asia in the near future, but there is no doubt that this is one area of the world to watch very closely.

Leave a Reply