China vs the US: The Battle for Oil

China vs the US: The Battle for Oil

Directed by Jean-Kristophe Klots (2012)

Film Review

The Battle for Oil is about the battle between China and the US over the world’s dwindling oil reserves. Globally China is the second biggest oil consumer – after the US. Owing to its dwindling reserves, they import two-thirds of their oil. High domestic demand for oil leads to periodic power blackouts and long queues at services stations.

China has three state-owned oil companies employing tens of thousands of workers, mainly in London, Singapore, New York. The country’s high demand for oil has led to major investment in African and South American oil producers. Rather than buying barrels of oil, China seeks investment in oil production capacity. Chad, Sudan and other African countries have granted them major oil concessions in return for major infrastructure investment in ports, railroads, telecommunication networks, schools, and clinics.

China’s ability (thanks to immense cash reserves) to invest in massive infrastructure projects gives them significant competitive advantage over western oil companies. As does China’s commitment to absolute non-interference in the host country’s political affairs. This contrasts sharply with western loans. The latter are always accompanied by demands for “democratic” and “human rights” reforms, which turn out to be camouflage for further penetration by Wall Street interests.

In 2005, China freaked out US lawmakers by attempting to take over the American oil company Unocal. Owing to their desire to preserve friendly trade relations, China dropped their Unocal takeover bid and shifted their focus to forging alliances with oil producers hostile to the US, such as Iran, Russia and Venezuela. Much of the current US animosity towards Venezuela stems from growing Chinese investment in their oil industry – a fact rarely mentioned in the mainstream media.

 

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