The Geopolitics of Russia's Intensifying Energy Cooperation with China : Motivation, Development and Challenges

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2014-09
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en
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During the past decade Russia and China have engaged in closer energy cooperation. Increasing energy exports to the Asian-Pacific market have emerged as one of the top priorities in Russia‘s energy policy. Energy resources are indispensable to the Russian economy by providing over half of the federal budget, and having a record of being used as a salient political tool in the former Soviet states. Russia needs to continue producing and exporting energy to retain its stature. Russia‘s main destination, Europe, accounting for the majority of energy exports, is actively diversifying its suppliers because of growing political tensions. In addition, Western Siberian oil and gas fields are slowly depleting. This thesis argues that from a balance of power perspective, diversifying energy towards China provides Russia with a leverage over the European Union by being less reliant on Western exports. Secondly, Russia and China share the same goal of a multi-polar world rather than the current U.S. dominated unipolar world, a political incentive for cooperation. From a geopolitical perspective, China can accelerate the development of Russia‘s Eastern Siberia and Far East, coinciding with Russia‘s recent energy and foreign policy strategy of ‗pivoting towards the East.‘ As for China, the nation‘s economy is growing rapidly, and so is its demand for natural resources. With energy consumption exceeding the domestic energy production, China is expected to increasingly rely on energy imports. Currently, over three quarters of Chinese energy imports are shipped through the Strait of Malacca, a transfer route posing a high risk of disruption due to acts of piracy. Therefore, the Chinese government is seeking alternative energy suppliers in advancing sustainable energy supply security. Russia appears to be an ideal partner for China to guarantee a long-term supply of energy by reducing the strategic vulnerability of the energy trade route. Although the energy relations between Russia and China seem promising, there are challenges and conflicts between these partners in energy pricing and regional dominance, neither wanting to provide the other party a relative gains advantage. In addition, Russia is concerned over its weakening influence in Central Asia and the domestic Russian Far East due to an increasing Chinese presence in these regions. Still, geopolitically Russia has no viable alternatives and China requires diversification of its fuel mix as well as stable sourcing. The case study of the Eastern Siberia Pacific Ocean Pipeline politics reveals the determination of both parties to form long-term energy cooperation, and the geopolitical considerations behind Russia‘s choice of partners.
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Faculteit der Managementwetenschappen