Driving China's pipeline strategy of seeking agreement with Russia and Central Asian states for transmission of oil and natural gas is a potential shortage beyond the energy issues so prominent in the media.Or, they could just be good neighbors and cooperate with the rest of world instead of getting all paranoid.
And China's potential shortage is tankers. According to a recent report in PortWorld, a prominent Chinese shipping executive commented that by 2015 China will need nearly 150 Very Large Crude Carrier tankers to meet its rising energy needs. For Beijing, the news is bad, as the country's top five shipping companies currently have a combined fleet of 27 VLCCs.
VLCCs are the second-largest class of tankers, displacing 200,000-320,000 tons, and are capable of carrying 2 million barrels of oil. Tankers are second only to pipelines in terms of efficiency, and their efficiency of large volume transport means that importing oil by tanker adds only two to three U.S. cents per gallon to cost.
Nor would this be all. As the majority of new tankers being built for Chinese shipping firms will fly China's flag, China's navy would inevitably have to expand to provide force protection for its expanded merchant marine. To protect its Middle East and African imports, the Chinese navy would be forced to deploy far beyond the South China Sea south and westward into the Indian Ocean and Arabian Sea, a logistical nightmare compounded by the vulnerability of Chinese imports traversing some of the more volatile maritime choke points, from the Strait of Hormuz to the Straits of Malacca.
During the 1980-1988 Iran-Iraq War, free-floating sea mines were released in the 21-mile-wide Strait of Hormuz. The 600-mile-long Straits of Malacca, transited by 50,000 ships a year, is 1.7 miles wide at its narrowest point and suffers from a combination of traditional piracy and indigenous Muslim extremist movements that make passage of the waterway especially unsettling. Among the Islamic terrorist groups active in the area are the Free Aceh Movement, Jemmah Islamiyah Lashkar Jihad, Laskar Jundullah and Rabitatul Mujahideen.
Even worse for Chinese naval planners is the fact the U.S. Navy is active in both areas. In short, a massive Chinese tanker fleet represents a horrendously expensive and vulnerable logistical nightmarish scenario in which China will have to invest billions with no guarantee of 100 percent security.
Saturday, May 10, 2008
China needs a sea bridge which could fill the ocean with huge oil carriers. But they don't have enough and are looking to pipelines. Reported asAnalysis: China faces tanker shortage: