While China's oil dealings with countries like Iran and Sudan receive global attention, its budding relationship with Iraq may turn out to be the most important.
A lot of attention has been paid in recent years to energy-hungry China’s billion-dollar bids on oil fields in Canada and the Asian giant’s reliance on oil from countries like Iran and Sudan to fuel its growing economy. But its growing interest in another major oil producer has gone largely unnoticed, and if current trends continue, that Middle Eastern country could become the world’s next “oil superpower,” with China, not the West, acting as both Iraq’s main partner and top beneficiary of its rich resources in what some now call the B&B trade axis (Beijing and Baghdad).
In the past decade or so, China waited patiently on the sidelines while the U.S. and its allies coped with Iraq’s new, and often times messy internal dynamics that followed the 2003 overthrow of Saddam Hussein by a U.S.-led coalition. China reemerged in 2008, however, to sign post-Saddam Iraq’s first major oil deal with a foreign country. While the majority of Iraqi oil deals in the post-Saddam era were awarded to Western firms, the Western shift to a more amenable and independent oil-rich Kurdish region in the north amid disenchantment with southern Iraq is creating a vacuum that China has found hard to resist.
Even more so than Russia, a traditional player in Iraq during the Soviet era, China has the capital that Baghdad is desperately seeking to build its oil and gas infrastructure, while Iraq has crude potentials that are alluring to a China that seeks to diversify its energy sources. Already, Chinese oil firms have taken an active interest in acquiring deals that had been awarded to Western firms in 2009-2010, which the latter are now relinquishing so they can focus on alternative oil fields in Kurdistan. Although talks between China and Iraq go back to at least 1997, major investments have only occurred in recent years, with Chinese National Petroleum Company (CNPC) focusing on the 17 billion barrel Rumaila field — Iraq’s largest — and Halfaya, both in the south. As of 2010, China had made five major oil investments in Iraq since the overthrow of Saddam Hussein, one of which was in Kurdistan.
Relations are already on the right foot. To create goodwill with Baghdad, Beijing in 2010 forgave about 80 percent of Iraq’s $8.5 billion debt to China and has signed multibillion-dollar trade deals in various sectors, including industry, government, tourism, and transportation. As China seeks to expand its fledging defense industry, it is not unreasonable to think that at some point Iraq will turn to it for military hardware, which in turn would create incentives for greater military cooperation between the countries and further entrench China’s presence in Iraq.
Photo Credit: Government of China
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swati
China is moving towards well planned development, with all other things we should appreciate its progress and self reliant status.
Theo Prinse
It is best for scientist to speed up Carbon Nano Technology likely to enable automobiles, airplanes passenger and cargo ships and their engines to be built at only 10 % or less than their current weight.
2. The price of energy must lower but than the US Federal Reserve inflationary policy must change dramatically from a US banking historic perspective. Nixon's Federal Reserve policy created the OPEC price of oil rise and Geithner and Bernanke's QE the Arab Spring. Clinton talks with Moscow over Syria will effect the Fiscal Cliff debate.
3. There are energy cheaper solutions like Thorium and Very High Temperature reactors (Gen4)
4. The US still must implement Romney's Energy Independence in 2020 plan leaving Arab oil and Al Qaeda to China and India. They know how to deal with them and refract from the neo con policy to rather have dimmie Carter have the youth in the Islamic world surrender to Muslim fundamentalism than to to the former Soviet Union that no longer exists.
5. With Nuclear Thermal Rockets and when available Hypersonic SCramjet Space Planes … Helium-3 for Nuclear Fusion reactors can be exploited economically from the Moon.
The worlds economic crisis is caused by the distribution over decades of an overwhelming amount of US dollars in the world. Since the fall of the Berlin Wall and subsequent with the end of the arms and space race the level of high innovation and research stagnated.
So the innovative products like CNT, NTR, VHTR, SCramjet etc. are since lagging behind while the amount of Clinton Obama dollars society oriented towards direct consumables instead of long term investment in research and innovation and bought them electorate on the near term for there re-distribution of wealth policies.
Innovation is financed through savings from gains of former innovative products, new production methods and lower prices only.
Instead of savings invested in new innovation and research liberals print more and more inflation diminishing the ratio between savings for innovation more and more buying them more and more time in political power .
With spending cuts directly reinvested in innovation and research the economy will not stagnate and ultimately produce new wealth.
Bill Jones
There must surely be an award for most deceitful sentence of the day
"In the past decade or so, China waited patiently on the sidelines while the U.S. and its allies coped with Iraq’s new, and often times messy internal dynamics that followed the 2003 overthrow of Saddam Hussein by a U.S.-led coalition."
As a description for the murderous bloodbath that the US war of aggression unleashed.
Bankotsu
And the U.S still has the face to come and lecture to China on military aggression.
Richardxu
History is written by the victor ,history is filled with liars, cause all you need to change history is good lie and a river of blood.—-Call of Duty 6 Captain Price
scdad07
Well to the points. Thanks.
Nothere
"History will judge our intervention in Iraq" – Well, Bush was an oil man….
Blame Bush
Why not the Iraqis are now considered the most corrupt regime in the USA
Bush should be in the ICC , with Paul Bremer and the rest of the Mafia
Bankotsu
Don't forget Tony Blair and the rest of the neo con gang. All of them should be on trial for war crimes.
WarrenD
Eh?!?! How can the Iraqis be "the most corrupt regime in the USA"? There is actually a world outside the US believe it or not. How about 'the Iraqis are the most corrupt regime outside of the US'? Makes more sense, doesn't it?