China’s voracious appetite for energy continues unabated. China’s leaders want to quadruple GDP from its 2000 level by 2020. This intensity of demand is currently a major driver of global energy markets and offers enormous opportunities to China’s energy-rich neighbours in Eurasia, including Kazakhstan, Russia, Turkmenistan and Uzbekistan.

A commonly-held view in the West is that a new “Great Game” is underway in Central Asia as the major powers compete for the region’s abundant energy resources, and that China is moving fast and furiously to lock up resources and exclude other players.

Kazakhstan does not subscribe to this analysis. Instead, we see a “win-win” situation based on the vast opportunities for Central Asia and Russia to export energy to China on a larger scale and to cooperate more intensively in the process. Crucially, China also wants to satisfy its energy requirements in a balanced way that promotes stability on its periphery.

Over the past decade, China has accounted for nearly 50 percent of total growth in global crude oil consumption. Today, it is already the world’s largest oil importer. Spurred by a rapid growing urban transportation sector, China’s oil demand is likely to reach 550 million tonnes by 2015 and 650 million tonnes by 2020. The country remains the largest producer and consumer of coal, and consumption of natural gas is on the rise as electricity demand continues to grow rapidly.

The huge increase in oil demand has posed serious security of supply dilemmas for China’s leaders, since heavy reliance on supply from the Persian Gulf (almost 50 percent of imports in 2005) puts pressure on guaranteeing seaborne transit and using the Malacca Straits, the main shipping channel between the Atlantic Ocean and the Pacific. The security commitments by the US to some countries in the region with which China has existing or potential territorial disputes increases the risks of deliveries by sea.

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