China’s Energy Insecurity Glaring In South China Sea Dispute


The energy-significant South China Sea remains in dispute, as China continues to claim almost the whole territory, despite that fact that it was ruled in July, at an arbitration tribunal in The Hague, that China had no title over the South China Sea. China’s ongoing claims to this territory reflect its energy insecurity, which is growing as energy demand continues to expand.

China’s own energy fields are mature, and production has peaked, meaning that new oil production requires higher levels of technology and investment. Imports and alternate sources of fossil fuels are now a necessity, and China has looked to secure the South China Sea in order to lock in its oil supply.

The South China Sea is believed to have 11 billion proved or probable barrels of oil in reserves, and about 190 trillion cubic feet of natural gas. China states that they own these resources, and riled up its neighbors when a China National Offshore Oil Corporation-owned rig began drilling in this region in 2014, sparking protests in Vietnam. Chinese coastguard ships have also thwarted attempts by the Philippines to develop its oil and gas reserves in this area.

China looks to diversify its oil sources

However, while it is the case that the South China Sea boasts a significant amount of oil, this largess is estimated to meet about three years’ of China’s oil import demand (335 million tons in 2015), and even less of China’s total oil demand (541 million tons in 2015). As it turns out, China has other oil interests in this location. Most of China’s oil imports (82%) pass through the South China Sea after going through the Malacca Strait. China cannot possibly claim the Malacca Strait, which is surrounded by Indonesia, Malaysia and Singapore, but it has claimed the South China Sea, the next best thing.