Prof. ST Hsieh
Director, US-China Energy Industry Forum
STH Comments: The following news reports illustrate some challenges facing US-China Energy Trades. It is not only about geopolitics but also it is about risk diversifications, prices, and supply stability. Energy security is national security, it is also about affordable costs for the public. China and Russia have one of the world’s longest land boundaries. It is nature, for China and Russia to focus on developing cross-boundary trades. Specifically, energy trades between Russia and China are mutually complimentary. Land based crude oil pipelines and gas pipelines are secure with long term contracts as compared sealine supplies which takes time and subject to interferences from third party. US export crude oil and LNG to China must be competitive.
The China-Russia trade volume is relatively small as compared to the China-US trade. However, energy occupies a more significant portion (say 30%) of the China-Russia trade, and it is expected to increase in view of the trilateral relation between the US, China, and Russia. Further, power grids of Russia and China are connected so Russia can directly sale MW to China market.
It is also noteworthy that China is expanding its trades with the Central Asia Nations including energy, further diversify China’s global energy supply sources. Last but not the least, China is firmly committed to climate change by realizing the country’s goal of peaking carbon emissions by 2030 and achieving carbon neutrality by 2060.
Record Russia trade attests to tiesBy ZHAO RUINAN | China Daily | Updated: 2022-01-26 00:00
Record-high trade flows last year between Russia and China that came despite the COVID-19 pandemic attest to the great progress made in bilateral cooperation, Russian Ambassador to China Andrey Denisov said on Tuesday.
Denisov expects the two neighbors to further bolster economic and people-to-people exchanges in 2022.
Trade between China and Russia in 2021 reached $146 billion, a jump of 35 percent from the previous year, the ambassador told reporters at a news conference in Beijing. He stressed the scale of the achievement at a time when the world was battered by COVID-19.
China-Russia trade hits record high in 2021 amid stronger energy cooperation: Russian envoyBy Global Times Published: Jan 25, 2022 10:31 PM
Despite the COVID-19 pandemic, logistic hurdles and other challenges, trade between China and Russia in 2021 bucked the trend by jumping 35 percent year-on-year to $147 billion, exceeding the pre-pandemic level in 2019 and reaching a record high, Russian and Chinese officials said.
Rising bulk commodity prices and energy consumption drove the trade growth against the backdrop of China’s booming demand for energy and the high complementarity of the two countries on trade, a trend that both diplomatic and business representatives believe would be further strengthened in 2022.
Speaking at an annual press conference in Beijing on Tuesday, Russian Ambassador to China Andrey Denisov said that the rising prices of some key tradable commodities such as energy – accounting for 30 percent of total exports – were the major drivers for growth.
While China’s energy demand witnessed a rising trend amid the consumption recovery for both the domestic and global market as well as the country’s embrace of green energy, cooperation on LNG has piggybacked on the new level with more projects.
In 2021, China and Russia carried out extensive and rapid cooperation in LNG, and the two countries are maintaining close communication on natural gas cooperation. Such cooperation is expected to further boost trade with new transmission lines to be established soon.
While China’s demand for natural gas from Russia continues to expand, Russia will also further expand coal and power supply to China, the envoy said.
In addition to traditional energy resources like oil, cooperation in some new sectors like LNG and nuclear energy has picked up, Li Ziguo, a senior research fellow with the China Institute of International Studies, told the Global Times on Tuesday, predicting that the share of energy in trade in 2022 should further increase to more than 35 percent.
The trade growth is the result of the political guarantee established by the high-level mutual trust and friendly relations between China and Russia as well as the economic guarantee provided by the complementary and mutually beneficial industrial resources of both sides, Gao Qi, Chief Representative of the China Council for the Promotion of International Trade in Russia, told the Global Times on Tuesday.
In 2022, trade exchanges between China and Russia in areas such as energy, electromechanical and agriculture will continue to grow, while economic cooperation in high-tech, aerospace technology, nuclear energy technology, e-commerce and other fields is expected to accelerate, Gao said.
Russia is China’s largest source of energy imports, the second largest source of crude oil imports, and the largest source of electricity imports, while China is Russia’s largest trading partner, according to media reports.
China to aid 5 Central Asia countries with additional 50 million vaccines, to continue ‘high-level political mutual trust’ Political mutual trust facilitates booming trade, enhanced connectivityBy GT staff reportersPublished: Jan 26, 2022 12:38 AM
Chinese President Xi Jinping on Tuesday said China is ready to work with Central Asian countries in building a closer community with a shared future and pledged to build a cooperation belt for high-quality development, strengthen the shield for defending peace, diversify interaction mechanisms and offer assistance to advance the Global Development Initiative.
Xi stressed at the summit the necessity to speed up the China-Kyrgyzstan-Uzbekistan railway project, and further develop transport corridors connecting China and Central Asia.
China and Central Asia needs to ensure the steady operation of oil and gas pipelines, expand cooperation across the energy industrial chain, and promote low-carbon transition in the energy sector. We also need to strengthen cooperation in artificial intelligence, big data, cloud computing and other high-tech sectors, Xi said.
Xi stresses solid efforts for ‘dual carbon’ goal
Top meeting reaffirms China’s climate commitmentBy GT staff reporters Published: Jan 25, 2022 08:48 PM
Chinese President Xi Jinping has stressed fully grasping the urgency and arduousness of realizing the country’s goal of peaking carbon emissions by 2030 and achieving carbon neutrality by 2060, and he called for solid implementation of decisions and arrangements made by the Communist Party of China (CPC) Central Committee, the Xinhua News Agency reported on Tuesday.
Xi made the remarks on Monday when addressing a group study session of the Political Bureau of the CPC Central Committee, which focused on striving to realize the country’s “dual carbon” goal, according to Xinhua, reaffirming China’s climate commitment as the country moves swiftly to carry out relevant efforts.
During the session, Xi also stressed the need to fully understand the importance of the “dual carbon” goal for the country’s own development as well as for the global community and to strengthen confidence in carrying out work for the goal. The President also noted that meeting the goal is a broad and profound change, and it is not something that can be achieved easily.