China makes US economy its hostage

Competition for Energy

The global prices for oil and coal are already at record highs and China only consumes 1/15 the amount of per-capita energy as the US! Chinese energy companies are becoming increasingly visible, scouring the globe for stable supplies of energy and often coming head-to-head with American energy companies. Conveniently, China does not recognize the ethical issues which arise from purchasing energy from dictatorships and corrupt regimes, whereas US companies are limited from doing business in these places. From Sudan to Myanmar to Kazakhstan, Chinese companies have set up join ventures where US companies could not. While energy prices have certainly risen in the US, they have not kept pace with global energy prices. In this way, China is able to ensure that its citizens and its businesses have the oil, coal, and natural gas that they require, while their American counterparts may be forced to conserve.

Two years ago, the Chinese National Offshore Oil Company [CNOOC] attempted to purchase an American energy company, Unocal, for over $18 Billion. However, the deal was blocked by the US Congress, which feared Unocal’s energy reserves would be supplied to China at the expense of Americans. It did not help CNOOC’s case that 70% of the Company was effectively owned by the CCP. Needless to say, Chinese government officials were not happy with the outcome; (Unocal was ultimately sold to Chevron for a lower price). China has already shown its willingness to use extreme tactics to secure an adequate energy supply. It seems reasonable to expect its energy policy will continue to oppose and inconvenience the US.

Source: Seeking Alpha