Wednesday, April 19, 2006

Alluding to the “Great Game” of the 19th century, when Britain and Russia contended for supremacy in Central Asia, former Secretary of State Henry Kissinger observed in June in a Washington speech before the U.S.-India Business Council that “the Great Game is developing again.” Mr. Kissinger, who executed Richard Nixon’s “triangular diplomacy” involving the Soviet Union and China during the early 1970s, argued that “the amount of energy is finite, up to now in relation to demand.” As a result, “competition for access to energy can become the life and death for many societies.” Addressing a $4.5 billion natural-gas pipeline project from Iran through Pakistan to India, Mr. Kissinger remarked: “It would be ironic if the direction of pipelines and locations become the modern equivalent of the colonial disputes of the 19th century.”

A new geopolitical “Great Game” is clearly unfolding as China’s development-driven, rapidly rising demand for petroleum has played a significant role in soaring oil prices. The price of oil, which averaged less than $22 per barrel in 2001, has increased by about $50 per barrel since then, surpassing $70 in recent days. Over the same period, the U.S. Energy Information Administration (EIA) reports that Chinese oil consumption has increased more than 40 percent. That increase has accounted for more than a third of the total growth in worldwide oil demand over the same period.

China became a net oil importer in 1993. Today, China, which consumes 7 million barrels per day, half of which is imported, is the world’s second-largest oil consumer and third-largest oil importer (behind the United States and Japan). Nearly half of China’s imported oil comes from the volatile Middle East, where it has been busily signing long-term supply deals, including a $70 billion oil-and-gas deal with Iran.

China’s future trends are even more dramatic than those of the past. Following the recent surge in China’s demand for petroleum, its per capita consumption of oil is still less than 8 percent of America’s. Adding 5 million cars per year, China expects its auto fleet to increase from less than 25 million today to more than 125 million within 25 years. As a result, the EIA projects that China’s demand for oil will more than double by 2025, reaching 14.2 million barrels per day, and more than 10.9 million barrels will be imported. As a result, China’s net imports will have increased by 8 million barrels per day since 2004. Until President Bush recently joined his six immediate predecessors by promising that America’s addiction to oil would end, the EIA had been projecting that U.S. net petroleum imports, which averaged 4.2 million barrels as recently as 1985 (when China was East Asia’s largest oil exporter), would exceed 19 million barrels a day in 2025, reflecting an increase of more than 7 million barrels since 2004.

The trends and arithmetic point to a significant increase in the possibility for “Great Game” problems to emerge, almost certainly in the Middle East.

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2021 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.


Click to Read More and View Comments

Click to Hide