17 July 2014

Editorial: So China Moved Its Oil Rig. What Now?


By Shannon Tiezzi

Why did China move its oil rig, and what does that mean for the future?

As Clint reported earlier today, China has removed its offshore oil rig from waters near the Paracel Islands. The rig, which had been operating in an area Vietnam claimed as part of its exclusive economic zone, caused a major rift between Beijing and Hanoi. The rig is currently being moved to a new project near Hainan, according to China’s Foreign Ministry.

The move came as something of a surprise, as the rig was originally scheduled to stay in the area until mid-August. Speculation raged over why the rig had been removed. A Chinese energy expert told Reuters that he though the rig had simply been able to finish its task ahead of schedule due to favorable weather conditions over the past two months. Other analysts suggest that China took advantage of the upcoming typhoon season to remove a major source of friction between it and Vietnam. Vietnamese Maj. Gen. Le Ma Luong was even more blunt, according to the New York TimesHe claims that the “strong reactions” from Vietnam forced Beijing to move the rig early.
The timing of the move is somewhat curious. The rig was set up shortly after Obama’s trip to Asia, causing many analysts to argue that China was sending a signal more to the U.S. than to Vietnam. Now, the removal of the rig comes less than a week after China’s South China Sea maneuvers reportedly “topped the agenda” at the Strategic and Economic Dialogue in Beijing. Still, months’ worth of criticisms (including heated speeches at the Shangri-La Dialogue) have had no effect on Beijing’s calculations; it’s disingenuous to suggest that the S&ED was the tipping point. 

Read the full story at The Diplomat