NINGBO, China - In perhaps the most remarkable sign of the Sino-U.S. tug of war on energy, supertankers are making the costly 40- to 45-day journey to China from Venezuela, a traditional and consistent U.S. supplier.Woohoo! Dateline Ningbo! We're famous!
If the tankers were to offload at the U.S. Gulf Coast, it would take only a four-day sail. Venezuela's anti-American leader, Hugo Chavez, sharply raised exports to China this fall, boosting heavy crude and fuel oil exports by 170,000 barrels per day and pledging to reach 300,000 barrels per day by the end of 2006. "Everybody is competing to sell oil to China, and we won't be left behind," Venezuelan Energy and Oil Minister Rafael Ramirez told reporters in Caracas. Shipping costs add roughly $5 per barrel to the oil, but Venezuela insists it isn't subsidizing sales to China.
Of course not...there's kickbacks in there.
China is returning the favor with new oil exploration capital, a $250 million plan for a telecommunications network and offers to launch a satellite for Venezuela. To the north, China is taking a strong interest in Canada's vast oil sands deposits, investing in a $2 billion oil pipeline project and taking bites of smaller private companies. "Every barrel that Canada sells to the Chinese is one less barrel it can sell to the United States," said energy analyst Gal Luft, noting that Western Hemisphere crude exports to China "will essentially make the United States more dependent on Middle East oil."