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Irina Slav

Irina Slav

Irina is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry.

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Is China The Next Key Influencer In The Middle East?

Saudi Arabia’s king Salman last week invited Beijing to take a more active part in Middle East politics and in response, the Chinese Foreign Ministry said it would be happy to act as mediator between Riyadh and Tehran – and this on top of preliminary investment deals with a potential total value of $65 billion.

Just days after king Salman’s departure from China, Israel’s PM Netanyahu headed there, saying that “Israel is in high demand,” citing recent trips to Washington and Moscow. Ahead of the visit, China’s Foreign Ministry spokeswoman said “it is hoped” that Saudi Arabia and Israel will both contribute to peace in the Middle East.

Meanwhile, a Chinese tech company, ZTE, pleaded guilty to charges of violating U.S. sanctions against Iran, by supplying U.S.-made equipment there for the construction of telecommunications networks.

It seems that what China is doing in the Middle East is, put simply, playing the field. It is the world’s second largest consumer of crude oil and its local production is declining. Saudi Arabia, Iran, and Russia are among the top five oil producers in the world. And oil is only the beginning.

China has an ambitious plan to expand its global influence. With the Middle East being the notorious political hot spot that it is, greater Chinese involvement there would only contribute to the expansion plans, especially if Beijing is successful in this involvement.

Related: Deciphering Today’s Oil Markets

The picture that is being painted now is pretty colorful: China has close ties with Iran and Russia. Russia, although clearly on Iran’s side in the regional axis of antagonism, not long ago demonstrated willingness to take part in a nuclear power plant deal with Riyadh, despite a major rivalry between the world’s #1 and #2 oil producers for none other than the Chinese market, among others.

Traditionally, the Middle East has been a playground for Europe, the U.S., and Russia. Now, China is signaling that this is about to change – with the blessing of the regional leaders, no less. While Beijing ensures its long-term supply of crude, it is also more likely than not to curb other stakeholders’ influence in the region, most notably that of the U.S., which might change the dynamics in the Middle East radically.

It is public knowledge that besides Israel, Saudi Arabia is America’s greatest ally in the Middle East. Iran, on the other hand, is a target for Washington. China is aligned with Iran, and now is going for Saudi Arabia as well.

For the Saudis, the forging of closer ties with Beijing is probably a way of adding a major ally against Tehran and defender of Riyadh’s interests in the region. For the Chinese, however, this will hardly be the case, and not just because of their stated role as mediator. China simply has its own agenda, which is often at odds with that of Riyadh’s other major ally, the U.S. Related: Expert Analysis: The OPEC Cuts May Be Working

Would the U.S. surrender its dominant position as external influence on the Middle East? That’s unlikely. Would it surrender it specifically to China? That’s even harder to believe. Can it stop the shift in spheres of influence? Again, the answer is in the negative – there are just too many interests involved and these are to be reckoned with, if for no other reason than because of the nuclear capacity of China and its partners: Russia and Pakistan.

Those three, by the way, are forming yet another axis, according to some sources. Geopolitical tectonic plates are still shifting, and the new landscape may look very different from what we have now in the Middle East.

By Irina Slav for Oilprice.com

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