Oil, Gas, and the South China Sea assesses China’s skyrocketing oil and gas demand and the actions the People’s Republic is now taking to firm up its supply of these essential resources. In pursuit of oil and gas, China now routinely encroaches upon the waters of other South China Sea littoral states, such as Vietnam, the Philippines, Indonesia, and Malaysia. Despite international rulings against its behavior in the region, China’s expansionary pursuits have only intensified in recent years, jeopardizing the shared global interest of a free and open Indo-Pacific.
As this report explains, China’s additional use of oil and gas in 2020 exceeded its additional renewables use by 30 percent on an exajoule basis and China now consumes 50 percent more crude oil than it did just ten years ago. China’s oil consumption growth has accounted for two-thirds of new global oil consumption in recent years. China’s use of natural gas has accelerated even faster than its use of oil, multiplying tenfold since 2001.
Today, imports meet about three-quarters of China’s total oil demand and China is the world’s biggest crude importer. By 2030 four-fifths of China’s oil demand and half of its natural gas demand will be met by imports.
To mitigate this perceived problem, Xi Jinping has set China on a path towards greater resource production, both onshore and offshore. In seeking new offshore resources, China is now thrusting itself into conflict with the other countries that ring the South China Sea.