Friday, February 25, 2011

Russian, Eurasian and Chinese news this week in light of Middle East unrest

The oils prices are soaring because of the spreading unrest in the Arab world. However, Putin denied that his country, the world's second-largest exporter of oil, was pleased with the developments. While claiming that the surging oil price is a serious threat to economic growth in the world, and Russia would be hurt if foreign demand were crushed by high prices, Putin, on the other hand, is actively taking advantage of the North African turmoils to gain greater stake in Russia's talks with EU. Putin said unrest in North Africa and the Middle East underlined the importance of Russia as a reliable supplier of energy to Europe. In particular, Putin pointed out that Nord Stream and South Stream could have ensured gas supply to Europe, had they been implemented by now.

The Mideast violence also has posed both economic and political challenges to China. Iran was China’s 3rd-largest oil supplier in 2010, supplying roughly 426,000 bpd according to CNPC. Libya, meanwhile, supplied 146,000 bpd of crude to China during January 2011. Serious production outages in one or both of the countries could considerably cut supplies to China. Moreover, Beijing is obviously very concerned with potential domestic unrest in Xinjiang province, where resides the Muslim Uyghur ethnic group. In light of recent revolutions in the Arab world, Chinese authorities have approved the execution of four Uyghurs convicted of 3 acts of terrorism and murder in 2010 in Xinjiang, and tightened control over Uyghur-language publications. State media characterized the cases as acts of anti-society and anti-human terrorism and unrelated to longstanding ethnic tensions between Uyghurs and Han Chinese in the region.

Meanwhile, China and Kazakhstan are boosting their strategic partnership. Upon Chinese president Hu Jintao's invitation, Kazakh President Nursultan Nazarbayev paid a three-day state visit to China from Feb 21st to Feb 23rd. The two heads of state witnessed the signing of a series of cooperation agreements on cross-border water resource protection, high speed railway construction, and joint projects on petroleum, oil and gas resources. Chinese Premier Wen Jiabao and top legislator Wu Bangguo also met respectively with Nazarbayev earlier on Tuesday. "The Chinese government is ready to enhance coordination with Kazakhstan to implement various agreements and consensus, to exert the principal role of enterprises, and promote greater achievements of bilateral cooperation," the premier said. Then on Feb.23rd, China National Petroleum Corp (CNPC) agreed in principle with KazMunaiGas [KMG.UL] to form an equally-owned joint venture to develop the Urikhtau gas field in Kazakhstan. The pipeline will be connected to the massive Central Asia-China gas trunk that starts from as far as Turkmenistan and enters China in its northwestern Xinjiang region.

Finally, Foreign Policy published a photo essay this week under the title "China International", which collected images documenting Beijing's worldwide influence in 24 countries, including one in Turkmenistan.



TURKMENISTAN: A gas treatment station in the small town of Farab, located in the middle of the Karakum Desert, is one component of a Chinese-financed plan to build a more-than-4,000-mile-long gas pipeline from Central Asia. China has invested an estimated $6 billion, though some suspect that, due to corruption, the actual sum of money flowing to Turkmen and Uzbek businessmen may be considerably higher.


Articles referred to in this post:

"Путин: рост цен на нефть может негативно отразиться на экономике РФ" (Putin: oil prices may negatively affect the Russian economy)

"Путин: «Южный поток» мог бы остановить рост цен на нефть из-за беспорядков в Ливии" (Putin: "South Stream" could halt the rise in oil prices due to unrest in Libya)

"Putin outwits EU's South Stream opponents"

"Libya Looming: Key strategic implications for China of unrest in the Arab World and Iran"

"Xinjiang 'Tense' Amid Arab Turmoil"

"新疆3起暴力恐怖案4名被告被核准死刑" (Execution of four Uyghurs convicted of 3 acts of terrorism in Xinjiang approved)

"哈萨克斯坦总统:中哈必须将互相协作提升到新高度" (President of Kazakhstan: China and Kazakhstan must collaborate with each other in a higher level)

"中石油将开发哈萨克斯坦乌里赫套气田" (CNPC, KazMunaiGas in deal to tap Urikhtau gas field)

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