Japan-China Tensions over Energy

In the previous two posts, I discussed how the U.S. is encouraging Japan to amend its pacifist constitution to enable a more active military role in the world. Japan is thinking about developing missiles with offensive strike capabilities, and the U.S. is consolidating bases in Japan and even talking about closing some of them.

These developments do not mean that the U.S. is thinking of withdrawing its entire military presence from Japan. On the contrary,

[t]he U.S. air base at Misawa in Aomori Prefecture has taken over command functions from Hawaii for naval patrol and reconnaissance for Asia as part of the U.S. military's global repositioning, The Asahi Shimbun has learned. The northern Japan U.S. facility is now in charge of reconnaissance command for a region extending from the western Pacific to the Indian Ocean, including the Persian Gulf. Naval patrol command functions for Hawaii, meanwhile, have been reduced to cover only waters surrounding the Aloha state. The shift apparently represents the Pentagon's new strategy of putting greater command functions in the hands of U.S. forces stationed in Japan.

Thus, Japan's importance as a strategic base seems to be growing. Meanwhile, Japan seems to have outdone China in vying for a new oil pipeline from Russia.

Tokyo has been lobbying hard for an oil-pipeline route to the Pacific and has promised it would invest in developing untapped oilfields. To back up its lobbying, Japan reportedly promised up to $14 billion to fund the pipeline, as well as $8 billion in investments in the Sakhalin-1 and Sakhalin-2 oil and gas projects, according to Russian media reports. Japan has also said it will give Russia 8.4 billion yen ($77.6 million) to fund a feasibility study of the Nakhodka route. (Transneft is to complete a final study by next March.)

The United States is the world's biggest oil consumer; China is in second place and rising. Japan depends on the Middle East for 90% of its oil. Thus, the stakes are high in all directions. The pipeline to Japan may also serve U.S. interests, because it "would also be a strategic asset for Russia, allowing it to export to other Asian countries and perhaps the US west coast."

Tensions between China and Japan over energy don't stop there. Japan is embroiled in a dispute with China over offshore natural gas fields:

Current explorations of an offshore gas field in the East China Sea by both China and Japan have recently strained relations between the two powerful nations. The tension over sovereignty of this disputed gas field appears to be on the rise, exacerbating mutual mistrust dating back to the Sino-Japanese War and World War II - and not allayed by China's meteoric economic rise and voracious appetite for oil and gas. While Japan is concerned that Chinese drilling could siphon off natural gas from Japan's territorial seabed, Beijing considers Tokyo's claim as infringing on its interests and sovereignty.

In its quest to get to the reserves, China has hired a number of Western oil companies, including U.S.-based Unocal. This creates an interesting dynamic. Japan depends on the Middle East for 90% of its oil. Thus, helping out in Iraq is clearly in Japan's national interest. At the same time, the U.S. is eager to contain China and North Korea. For this reason, it is reshaping its military presence in Asia and encouraging Japan to take a more active military role. But even as these two countries conspire to contain China, Unocal is caught in the middle, a U.S. corporate interest siding with China's claims against Japan.