The tensions encompassing the South China Sea have always been mainly related to oil and natural gas. But it is mostly been argued that the planned shipping lanes shipping Middle East hydrocarbons toward East Asia are what really matter the most, while the sea’s energy resources are comparatively modest and unverified. In the last week, the U.S. DOS (Department of State) outspoken regarding China’s troubling actions in Vietnam’s EEZ (exclusive economic zone), which comprises of constant seismic evaluations by a Chinese vessel guarded by armed escorts.
According to the international UN rules, resources present within the region belong to Vietnam, but China’s “nine-dash line”—which is an indistinct and discredited borderline drawn by Beijing to allege nearly the entire sea—protrudes with it. It also protrudes with the EEZ’s of other countries such as Malaysia and the Philippines. In the last few years, repeatedly China has intimidated Southeast Asian countries and the foreign companies with whom they have collaborated out of mutual energy deals in the regions of overlap. It plans to secure exclusive access to such pacts for its own oil giants. One of the exceptions permitted for now is Vietnam’s existing drilling projects with Russian oil companies such as Rosneft and Gazprom.
Recently, Rosneft was in news for becoming the top Venezuelan oil trader that has helped in offsetting pressure from the U.S. Russian oil titan Rosneft has become the leading trader of Venezuelan crude, shipping oil to purchasers in India and China. It has also helped Venezuela to counterbalance the loss of conventional dealers who are avoiding it for concern of violating the U.S. sanctions. Data from Refinitiv Eikon and trading sources showed that Rosneft has topped the major buyer of Venezuelan crude in July and during the first half of August.