Shanghai Cooperation Organisation (SCO) and Global South strategic cooperation

tphuang

Lieutenant General
Staff member
Super Moderator
VIP Professional
Registered Member
No... Obviously the cheapest option would be to take it all from Russia and Iran. Saudi oil is the most expensive. And yet China is paying extra to get some Saudi oil as well. Isn't it obvious?
Hmm, no evidence Saudi is the most expensive when we have these long term contract. The spot purchases are the most expensive. Also keep in mind china works with Saudis to build these refineries so they are mostly tuned to taking in Saudi crude for refining. The Iran and Russian purchases are basically replacing the spot market purchases.

Longer term, they will just build more new refineries and export more of the end products.

Aside from that, china is also snapping up us crude from spot market because they are cheap right now due to Biden decision for releasing strategic reserves.

It's about controlling the market and making money off that.
The only fact that I can see is that Iranian exports are up and that's despite Europe buying less from Russia. How do you explain that? I think it has multiple reasons including the ones I mentioned. If shipments are up it seems very dubious to claim that the discount relative to the benchmark is increasing
China is exporting a lot of refined oil product since November. I have been posting this on the non renewable thread for weeks now. The refineries were running at like 70% capacity because the govt was being stupid. So ramping up import just increases refinery utilization.

At the same time, their spot imports are down. So that account for the differences. More import from Iran is good for china, huge profits on those.
Iran actually imports gas from Turkmenistan. They probably need a partner like China to be able to build a pipeline from the southern gas fields to the north. A southern pipeline to give Pakistan cheap energy would make so much more sense and could rescue the state from failure. As an added benefit, Pakistan wouldn't need USD to pay for it. Apparently Iran is now threatening to fine Pakistan for not completing their part of the pipeline, which is ridiculous. It's such a big missed opportunity it's painful to watch.
Iran produces like over 200 BCM of natural gas a year and capable of more than that with Chinese investment. China really needs to get working here if Iran plays ball.
 

taxiya

Brigadier
Registered Member
It's honestly kind of baffling to me that the US is just allowing it to happen.

Is their hold over Iraq really that weak? Or did someone's pockets also get filled during negotiations etc?
I think they are really that weak, at least much weaker since Saddam's death. When they invaded Iraq, they had GCC under their thumb. Now GCC are flirting with China. Iran is in SCO. Without GCC's approval and facing a Iraq more friendlier to Iran than Saddam, US is in a very weak position. US is barely there to save their face, and everyone else aren't in the rush to tear down the cover.

I think US' Iraqi war is the number one laughing-stock in human history that blows to the face of the "winner".
 
Last edited:

tphuang

Lieutenant General
Staff member
Super Moderator
VIP Professional
Registered Member
About Iraq, it's interesting what has happened here. If this is the result of Iranian influence, then that's awesome
Please, Log in or Register to view URLs content!
Looks like the pro-Shia/Iran part of Iraq is more comfortable with aligning with China and shunning the West. That has in turned caused America to turn its back on Iraq completely and now China has captured more of Iraq's oil fields and construction projects.

Please, Log in or Register to view URLs content!
now Iraq's oil exports to China really increased in 2022, presumably due to Chinese involvement of so many Iraqi oilfields. The only annoying part for me is that just 100k bpd of oil is for construction, anything on top is still settled in USD.

Looks like Iraq continues to draw up more construction projects for Chinese companies
Please, Log in or Register to view URLs content!

As a whole, it will probably take a while for Chinese influence to completely take over, but the fact that they've been able to put so many other foreign large oil companies out of Iraq is a big deal.
Please, Log in or Register to view URLs content!

As a whole, China's MENA strategy is really working.
 

luminary

Senior Member
Registered Member
About Iraq, it's interesting what has happened here. If this is the result of Iranian influence, then that's awesome
Please, Log in or Register to view URLs content!
Looks like the pro-Shia/Iran part of Iraq is more comfortable with aligning with China and shunning the West. That has in turned caused America to turn its back on Iraq completely and now China has captured more of Iraq's oil fields and construction projects.

Please, Log in or Register to view URLs content!
now Iraq's oil exports to China really increased in 2022, presumably due to Chinese involvement of so many Iraqi oilfields. The only annoying part for me is that just 100k bpd of oil is for construction, anything on top is still settled in USD.

Looks like Iraq continues to draw up more construction projects for Chinese companies
Please, Log in or Register to view URLs content!

As a whole, it will probably take a while for Chinese influence to completely take over, but the fact that they've been able to put so many other foreign large oil companies out of Iraq is a big deal.
Please, Log in or Register to view URLs content!

As a whole, China's MENA strategy is really working.
This recent article illustrates Iraq's BRI potential:
Please, Log in or Register to view URLs content!
With the arrival of goods at the port of Gwadar overlooking the Arabian Sea, Iraq becomes of great importance to China, which is seeking out fast and inexpensive routes to deliver product to Europe.

The Grand Faw Port and Dry Canal provide Beijing with an essential passageway for transporting its goods to the Old Continent. Iraq therefore aspires for the Grand Faw Port to be part of the BRI, especially since the Dry Canal will
Please, Log in or Register to view URLs content!
of goods to Europe by 25 days and cut shipping costs by half
.

Between 2005 and mid-2022,
Please, Log in or Register to view URLs content!
in West Asia and Arab African countries amounted to $2.25 trillion, accounting for 12.6 percent of China’s total investments abroad. During this period, Iraq ranked third among the countries that attracted Chinese investments in the region.

Since ports are an essential Chinese route to world markets, Beijing expressed interest in constructing the Grand Faw Port in Basra. In September 2019, Iraq struck a deal with China to help secure the necessary funds, known as Oil for Reconstruction.

The agreement
Please, Log in or Register to view URLs content!
into which Iraq would deposit revenues from 100,000 barrels of oil sold daily to two Chinese companies, while the rest would come from loans from Chinese banks with a limit of $10 billion.

But the deal, which was supposed to run for 20 years, was shelved due to sweeping Iraqi protests that erupted a month later, the global pandemic, a drop in oil prices, and Baghdad’s delay in approving the 2020 budget.

Some Iraqi political factions have accused former Prime Minister Mustafa Al Kadhimi of leaning too far toward the US and its allies – at China’s expense – and bowing to Washington’s demands to nix the China deal. Their campaign intensified after Kadhimi’s government in December 2020 selected South Korea’s Daewoo Engineering and Construction Company to build the Grand Faw Port.
1677207811261.png
 

tphuang

Lieutenant General
Staff member
Super Moderator
VIP Professional
Registered Member
Please, Log in or Register to view URLs content!
Reposting what I posted on the NEV thread. This I hope is a turning point for Chinese Tech in general. You can discount phones, computers and whatever but you can't discount evs. I think popularity of byd cars will propel Chinese tech and product quality around the world but especially in Asia. Byd is dominating in all the markets it entered. Give another 5 years and you have Chinese evs, 2 wheelers, trains, apps and giany tech firms everywhere, these countries will no longer look up to japan or south korea.
 

tphuang

Lieutenant General
Staff member
Super Moderator
VIP Professional
Registered Member
This recent article illustrates Iraq's BRI potential:
Please, Log in or Register to view URLs content!
btw, for all you that keep getting annoyed at Turkey's ambition, you might want to take a look at their strategic location. Outside of Russia, every land based transportation from China to Europe involves crossing Turkey. Avoiding Malacca Straits and Suez Canal involves going through Turkey.

Pursuing Turkey & Iran are not the same. 1 country has options and the other one doesn't.

From latest in the oil market since the EU Russian refined oil ban. There is so much cheap Russian crude on the market that Iranians are getting squeezed out.
Please, Log in or Register to view URLs content!
Reflecting the attractive price tags and offers, inquiries for Urals have been growing and demand for Iranian cargoes has been slipping as a result, refinery and trading sources said. Independent refineries now have a bigger pool of Russian grades to choose from, making it quite difficult for Iranian cargoes to sell in China, the sources said.
From what I can see, it's mind-blowing that China is now buying cheap US spot crude over Iranian ones. The Iranians really need to discount their cargoes to be attractive to these indecent refineries who are generally not afraid of US sanctions.

More Russian crudes are expected to flow into the independent refining sector in coming months, despite Russia's plan to cut output by 500,000 b/d in March.
From the Russian Artic-China voyage, at least two more Varandey cargoes are expected to land in Shandong next month, according to Shandong-based trading sources and Kpler vessel tracking.
"We don't see that the supply cut has affected the market fundamentals as the price falling further," said a feedstock management source at another independent refiner.
More importantly for China's own economy, this will simply allow China to have even cheaper energy compared to Europe and put the squeeze on European industries. It's amazing to see the Europeans destroying themselves to such a degree.
 

tphuang

Lieutenant General
Staff member
Super Moderator
VIP Professional
Registered Member
I will talk a little bit about potential important of ChinaSat-26

So this is the current ChinaSat-16 coverage. Noticed it just covers most of China's heartland + some coastal waters. Very limited, but 20 Gbps isn't bad.
chinasat-16.jpg.webp


This is the planned coverage of ChinaSat-26. Notice how the red area covers all of China, ASEAN countries, part of Central Asia and SCO countries of Pakistan & Iran. All areas that China considers to be in its sphere of influence. 100 Gbps satellite. Which given the coverage areas probably means that the transfer speed doesn't go up that much.
ChinaSat26Coverage.png

Its main competitor right now is Panasonic which uses XTS satellite.
Please, Log in or Register to view URLs content!
Panasonic uses Ku band and has following customers Air China, All Nippon Airways, Cathay Pacific Airways, China Airlines, China Eastern, China Southern, EVA Air, Garuda Indonesia, Hainan Airlines, Hong Kong Airlines, Japan Airlines, Singapore Airlines, Thai Airways, and Xiamen Airlines are among the Asian carriers scheduled to transition to the new XTS service.
So pretty much all the major carriers that ChinaSat would want to win over.
APSTAR 6D went into its first stages of operation in early 2021 and is now providing airlines flying across Asia Pacific with multiple gigahertz of new Ku-band capacity over China, including high-density air traffic routes across East Asia using XTS spot beams. APSTAR delivers 90 beams across the whole region, and 50 Gbps in capacity.
And it provides just 50 Gbps across the covered area.

So compared to this, ChinaSat-26 actually has an advantage.

Now, people are already comparing ChinaSat to Viasat, but Viasat's nice ka satellites current only covers North America and out to Western Europe. I would know this since I fly JetBlue quite a bit and their internet speed is top notch.

We also know that Viasat is a partner of ChinaSat since they both offer Ka band communication which means Viasat can install its IFC equipment on Chinese airlines and use ChinaSat for internet. We know that' already been happening for a few years now and they are signing up customers.

So, what about Viasat-3 satellites that will be super fast (1000 gbps of throughput) and will eventually cover APAC once launched in a few years. Well, you actually need ground stations for this to work properly. Because you need to beam to ground stations who actually do the internet request and send data to satellites. Viasat now signed contract for ground stations in Australia but that's really far from serving China or Central/Wester Asia or even northern part of ASEAN countries.

We know that Chinasat has ground stations or else how do they provide internet to airlines flying over?
Please, Log in or Register to view URLs content!
I'm assuming that cruise ships can also use them. Basically, anywhere that doesn't make sense for your future starlink network.

So with this and the next gen Chinasat + Chinese starlink, they have modern internet and IFC to BRI countries and their airlines and ships to use.

When China is building a system of its own parallel to West, it needs to make it a realistic option for countries in its orbit so that they can pick the Chinese options. As such, I expect the next ChinaSat to not only have higher throughput but more beams and larger coverage area. Eventually they need to launch one from Africa and South America also. These are often the forgotten regions because they don't provide the revenues needed to justify services.
 

luminary

Senior Member
Registered Member
From what I can see, it's mind-blowing that China is now buying cheap US spot crude over Iranian ones. The Iranians really need to discount their cargoes to be attractive to these indecent refineries who are generally not afraid of US sanctions.
US oil prices are cheap because they recently released more crude from their Strategic Petroleum Reserve, right? Does helping deplete US SPR and drive up US domestic prices come into China's purchase considerations?
 
Top