• 6 minutes Saudis Threaten Retaliation If Sanctions are Imposed
  • 11 minutes Can the World Survive without Saudi Oil?
  • 15 minutes Saudis Pull Hyperloop Funding As Branson Temporarily Cuts Ties With The Kingdom
  • 2 hours WTI @ $75.75, headed for $64 - 67
  • 1 hour U.N. About Climate Change: World Must Take 'Unprecedented' Steps To Avert Worst Effects
  • 16 mins Saudi-Kuwaiti Talks on Shared Oil Stall Over Chevron
  • 8 mins Closing the circle around Saudi Arabia: Where did Khashoggi disappear?
  • 8 hours U.S. - Saudi Arabia: President Trump Says Saudi Arabia's King Wouldn't Survive "Two Weeks" Without U.S. Backing
  • 5 hours OPEC's No. 2 Producer Wants to Know How Buyers Use Its Oil
  • 26 mins UN Report Suggests USD $240 Per Gallon Gasoline Tax to Fight Global Warming
  • 6 hours Iranian Sanctions - What Are The Facts?
  • 4 hours China Thirsty for Canadian Crude
  • 20 hours How High Can Oil Prices Rise? (Part 2 of my previous thread)
  • 20 hours Shell, partners approve huge $31 billion LNG Canada project. How long till Canadian Federal government Environmentalates it into the ground?
  • 4 hours Who's Ready For The Next Contest?
  • 7 hours EU to Splash Billions on Battery Factories
Trump Insiders Ramp Up Rhetoric Against Russian Energy

Trump Insiders Ramp Up Rhetoric Against Russian Energy

Trump insiders, including hawkish chief…

China Sends Oil Rig To Disputed Waters

Over the weekend of May 3 and 4, China sent an oil rig into disputed waters of the South China Sea to begin oil exploration. The rig is near the Paracel Islands, inside the 200-mile exclusive economic zone of Vietnam, which angrily protested the decision. The Vietnamese government insists that the waters, as well as the oil and gas reserves held beneath, belong to Vietnam.

Where boundaries are drawn in the South China Sea has long been a source of regional tension, but China has escalated the conflict by moving to drill the first well inside disputed territory. China said the oil rig would be operating from now until August 15.

Some observers see the move as a careful calculation by Beijing, which believes Vietnam won’t be willing to risk war over Chinese drilling. “It's going to be one more of these small, incremental steps that individually won't lead to conflict, but collectively, over time, gradually will change the status quo,” said Admiral Mike McDevitt U.S. Navy (Ret.), according to Foreign Policy.

Related Article: Diamonds From Smog? China Plans To Try It

For its part, Vietnam is demanding that China cease drilling operations. “All foreign activities in Vietnam's seas without Vietnam's permission are illegal and invalid,” Vietnam’s Foreign Ministry said in a statement. “Vietnam resolutely protests them.”

The move may also be a response to U.S. President Barack Obama’s recent trip to Southeast Asia, which included a deal with the Philippines to allow for a greater American troop presence in the region. The U.S. and the Philippines kicked off a two-week long military exercise on May 5.

The U.S. Energy Information Administration estimates that the South China Sea holds 11 billion barrels of oil and 190 trillion cubic feet of natural gas, most of which is located in disputed territory. China believes the oil and gas reserves could be much larger.

By James Burgess of OIlprice.com



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News