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China Plans to Initiate Negotiations with OPEC

Zhai Jun, China`s assistant minister of foreign affairs told conference participants in Dubai that China is interested in starting direct negotiations with OPEC in efforts to insure a stable supply of oil and a fair share of the international petroleum market. Zhai spoke at a conference of the Arab Strategy Forum, an organization that brings together political, business and academic leaders from the Arab world to discuss issues of importance. Speaking in Chinese he said that China was working on developing "a negotiating mechanism with OPEC," He added that "only through this can we maintain security and stability of our oil imports."

China`s growing demand for oil is one of the major contributing factors to the rising oil prices in the past two years. China is the world`s third largest importer of oil in the world, following the United States and Japan. Zhai discussed other contributing factors to the current price of oil, namely instability in certain oil producing nations such as Iraq and Nigeria. Zhai said his government is interested in increasing measures to resolve these instability creating conflicts.

China is a growing importer of many natural resources, and is attempting to gain further influence in setting the prices for these resources. China is constructing strategic oil deposits, and is zealously looking for new suppliers in Africa and South America in order to diversify its energy supply. Zhai said that China`s influence in the Arab world is increasing and the institutionalization of China`s influence as a major importer of oil is imperative. The United States` Energy Department estimates that China imported approximately 3.1 million barrels of crude oil and consumed 6.9 million barrels daily in 2005.