China is broadcasting that it wants a direct conversation with OPEC to secure a steady stream of oil for its mushrooming economy. It is easy to see the benefit of that for China, but the reasons for OPEC to have the conversation are more difficult to fathom. China imports six percent of the world’s crude and has been working on arrangements with suppliers in Africa and South America.
China may have to get in line behind the US and Japan. Both countries have felt the sting of higher oil prices and both have economies that rely on oil as much as China does. The need in China is acute because the economy is growing at 10% and a spike in price or drop in supply could undermine that.
It would appear that OPEC is unlikely to enter into individual conversations with countries that are the world’s largest consumers.
What would be the point?
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