The Geopolitics of Energy

Asias Energy Angst

Energy becoming key factor in Asias geopolitical architecture Energy nationalism rising with prices, perception of long-term looming scarcity Zero-sum competition for control of supplies and transport routes Intensifying focus on transit security, control Mainly oil but increasingly natural gas (LNG) long-term

South China Sea (Malacca Straits)

Key Countries with Energy Interests

United States
Interest in uninterrupted flow of oil, LNG

Indonesia, Malaysia
sovereignty, sensitive to U.S. role

Japan: 90% of oil supplies, 40% of LNG

Powerful navy, very limited role

China: 30% of oil supplies, headed for 60% Singapore: strong navy, littoral state, closer U.S. relations India: looking east, rivalry with China

Chinas Growing Focus on Sea Lanes

Fear US dominance sea lanes, also terrorism and piracy Lack of Blue Water navy power projection Must free ride on US, SE Asia naval powers Response:
String of Pearls: near-term port access strategy, submarines Blue Water navy development long-term Alternative routes: Myanmar oil pipeline Want to build Chinese tanker fleet only 10% now Growing interest in patrolling Straits Malacca; reducing US control

Conclusions

As oil and LNG prices rise, energy geopolitics focus on sea lanes and Malacca Straits will intensify U.S. dominance of sea lanes to continue Terrorism, piracy main near-term concerns Rise of China and possible asymetrical strategies to address energy shipping vulnerability are wild cards very long-term U.S., India, Japan all wary of China factor