January 15, 2006	Sunday	Zilhaj 14, 1426

WASHINGTON, Jan 14: China’s moves to secure crude oil supplies in Africa for its growing economy does not threaten US energy needs, a senior US State Department official said on Friday.

The United States and China, which rank as the No. 1 and No. 2 global consumers of oil and petroleum products, are both looking to Africa to help diversify their oil supplies.

China’s foreign minister, Li Zhaoxing, is currently visiting six African nations to increase China’s diplomatic and economic presence in a region where China already obtains about a third of its oil.

China’s top offshore oil producer, CNOOC Ltd., agreed last week to pay $2.3 billion for a stake in a Nigerian oil and gas field, its largest-ever overseas acquisition.

I don’t think China seeking oil in Africa is a threat to the United States’ interests, Jendayi Frazer, US Assistant Secretary of State for African Affairs, told reporters.

Most of China’s investment in Africa, however, is limited to oil producing countries, he said.

So one would hope that China’s investment would be broader and that it would contribute not only to China’s development and growth... but it would also contribute to Africa’s growth and development, Frazer said.

On Thursday, Li said in Senegal that he did not plan to sign new energy deals on the trip. He stressed that energy is part and parcel of (China’s) overall cooperation with so many African nations.

Li is also visiting Cape Verde, Mali, Liberia, Libya and Nigeria.

Nigeria is the fifth biggest foreign oil supplier to the United States, exporting just over 1 million barrels per day (bpd) to the US market.

Major US oil companies are again investing in Opec-member Libya after the Bush administration eased energy sanctions against the country in 2004.

China’s oil demand will average 7.4 million bpd in 2006, much smaller than the United States’s 21 million bpd.

However, China’s growth in oil consumption will be much bigger. China’s oil use is seen rising 7.2 per cent this year compared to an expected 1.7 per cent rise in oil demand for the US market, according to the US Energy Department.

A report last month by the Council on Foreign Relations said the United States faces stiff competition from China for African oil supplies, and that US companies need more government help to win African deals now going to Chinese firms.

The report predicted Africa would have the biggest incremental increase in oil production of any region over the next two or three years. —Reuters