Date Posted:05:58:51 08/21/06 Mon Author: Rebel Subject: Chavez seeks Chinese support, Beijing wants oil
Venezuelan President Hugo Chavez will be seeking political support as well as energy deals when he visits China from Tuesday, but Beijing is keen to stick to business and avoid antagonizing Washington, analysts say.
The globe-trotting populist leader will spend nearly a week in China on his fourth visit there and hopes to secure investment in oil production and shipping -- exploiting the shared interests of the world's number two oil consumer and its number five exporter.
But their courtship has raised hackles in U.S. corridors of power, where some officials fear the emerging Asian heavyweight is trying to edge its way into Washington's sphere of influence in South America.
Chavez will be aiming to drum up support for Venezuela's bid for a slot on the United Nations Security Council, in opposition to U.S.-supported Guatemala.
And he is always ready to bait Washington, which buys around 12 percent of its crude imports from Caracas, by flaunting his ties with oil-hungry Beijing.
"All (Latin American) countries want autonomy but Chavez wants more than that. He wants to go a step further and even confront the United States, so for that China is an important actor," said Juan Gabriel Tokatlian, of the University of San Andres in Buenos Aires.
Chavez may even visit China's secretive neighbor, North Korea, which recently infuriated the United States by test-firing missiles.
The Venezuelan leader said in July he had received an invitation from Pyongyang and planned to visit, although it was dropped from the itinerary of his last trip.
But Beijing does not share Chavez's taste for public spats and has no desire to dent Sino-American relations, which are gradually improving after trade and currency disputes last year.
With Washington already fretting about Beijing's ties with Iran, and concerned it is not exerting enough pressure on North Korea, Chinese leaders will be keener to pore over oilfield maps than risk criticizing the United States.
"We need their oil, and from a commercial point of view we are happy to buy it, but we don't want to get caught up in the politics," said one researcher from a government think-tank, who declined to be identified as the issue was sensitive.
"China's relations with America are more important."
At present, Venezuela's contribution to China's energy security is minimal, with just 1.72 million tones of crude imports -- 2.3 percent of the total -- in the first six months of the year.
The obstacles to more trade are mostly logistical. The trip to China is so long that oil usually needs to be carried in very large crude carriers (VLCCs) for shippers to turn a profit.
Venezuela's oil cannot be piped to Latin America's Pacific coast and VLCCs are too large to journey through the Panama canal. Once it reaches China, the heavy, sour oil is hard for most refineries there to process.
"I would say the economic attractiveness is relatively low, then but China is getting oil from everywhere," said Kang Wu at the East-West Center in Hawaii.
China should probably look to gain profit and experience from Venezuelan oilfields rather than extracting crude to ship directly to its own refineries, he said.
"I see it as more of an investment opportunity, it makes more sense for them to develop it and sell the oil elsewhere."
Chavez will head south to Malaysia from Beijing, for a trip expected to focus on trade and investment ties. One possibility is getting state oil firm Petronas, which has invested in 30 countries, to expand across the Pacific.
