Oil, China, and the Middle East

Investor’s Business Daily reports:

Mideast investors relish the fact that China doesn’t raise ideological issues like human rights
with its trading partners — unlike America. They also aren’t keen on big U.S. investments
since Congress blocked a Dubai-owned firm from taking over major U.S. port facilities in
Anne Korin, the director of policy and strategic planning at the Institute for the Analysis of
Global Security, sees a darker side to Chinese ties with the Middle East.
“The Chinese align their development aid and foreign policy with their energy needs,” Korin
She cites China’s willingness to use its veto in the U.N. Security Council to shield Sudan and
Iran from sanctions. Korin also warns that political factors could weigh more heavily than
market ones in future oil shipments.
In Venezuela, President Hugo Chavez is shipping generous supplies of crude to Cuba to
tweak the U.S. Back in the 1970s, the Arab oil embargo to protest U.S. support for Israel also
was about politics.
Given such precedents, she says it’s possible that oil could be used as a political weapon in
the future.
“As U.S. relations with the Muslim world continue to deteriorate and we continue to see
tightness of supply, we’re heading for a situation in a couple of decades where five or six
nations in the Middle East control the economic health of the world,” Korin said. “China
wants to make sure it has strong bilateral relationships with these countries.”

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