China's Risky Scramble for Oil

For China and India to reach just one-quarter of the level of US oil consumption, world output would have to rise by 44 percent. To get to half the US level, world production would need to nearly double.... and that's impossible

Published: 22-Jan-2005

N class=text>Look at this imbalance: The average American consumes 25 barrels of oil a year. In China, the average is about 1.3 barrels per year; in India, less than one.

So as the 2.4 billion Chinese and Indians move to improve their living standards, they're going to want more oil - likely more than can be produced.

That perceived shortage is setting off an intensifying scramble to tie up oil reserves around the world. So far, China has been the most aggressive player. But the competition is just getting going.

The pattern is clear. China has been weighing buying Unocal, a major US oil firm. Last month in Beijing, Venezuela's President Hugo Chávez promised to open that nation's oil and natural gas fields to China. Russia, in effect renationalizing the giant oil subsidiary of Yukos, may offer China a 20 percent chunk of the new firm.



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