In my work on the PetroChina IPO (scroll down the page for a link) I found out an interesting bit of information: China is now a net oil importer and thus dependent on foreign supplies for its rapidly growing industrial economy. To date, western oil companies have had a limited role in the Chinese oil industry. China has preferred to retain tight state control of oil – only allowing foreign investors and oil companies minority stakes in the newly privatized parts of the industry. Instead of letting foreign companies provide the oil they need, China is sending its own China National Petroleum Corporation, parent of PetroChina, around the world on an oil buying spree. A key target is Africa where CNPC has a deal with the Sudanese which has led many to accuse China and the Sudan of human rights violations in areas where oil is being drilled. This article in Newsweek is a useful summary of the larger geopolitical picture – it turns out the United States sees Africa as crucial to ITS effort to move away from heavy dependence on mideast oil. This suggests the possibility of renewed tension with the United States.
STEPHEN F. DIAMOND
A legal scholar and political scientist at Santa Clara University in Silicon Valley.
