China and America need not be energy rivals

Energy is markedly different from the other controversial matters that will be at the top of the US-Chinese Strategic Economic Dialogue, edition two, meeting this week in Washington. Trade and currencies are the now familiar issues at the centre of the economic tensions in the bilateral relationship. Energy, however, is about competition and the risks of collision around the world. At a time of tight markets and high prices, those risks can grow.
The real risks are not from competition in the global marketplace. Rather they would arise when oil and gas development gets caught up in larger foreign policy issues, of which those involving Iran and Sudan are currently the most obvious. What the dialogue can do is emphasise the very large common interests the two countries share as the world’s two largest petroleum consumers. The US imports 60 per cent of its oil; China 50 per cent. Between them, they account for almost 35 per cent of world consumption. Both benefit from stable markets, open to trade and investment. Here, the dialogue can help build China’s confidence in the reliability of the global market and the institutions maintaining its security. Of course, this is more challenging when anxiety about supplies and prices is so high.

Financial Times