If China wanted to, it could build Australia out of a rock in the sea. China’s militarisation in the South China Sea has been so rapid and blatant that it has resulted in an ICJ case brought by the Philippines, as well as many “freedom of navigation” missions by countries keen to remind the world that no one owns the South China Sea. China can flex its muscles, but could it actually strike.
The region’s large oil and gas reserves make it prone to falling victim to an oil war. By solidifying its grip, China could be one step closer to energy security. However, the estimated reserves of the region remain relatively small compared to China’s huge appetite. It receives more oil and gas today from Central Asia than it ever could from the South China Sea. The cost of war and the disruptions to energy production throughout the world would hurt China more than what it would gain from controlling the region’s energy resources. China would also struggle to maintain its grip on dispersed islands and floating oil wells, so the region would never be stabilised enough. The distance from the mainland also increases the cost and difficulty of transporting energy to where it is needed, secure links like the pipelines that link China to Central Asia are not an option.
Increasing tensions may also lead to retaliation from China’s enemies. China has deployed an offshore oil rig in waters claimed by Vietnam, and Vietnam has answered by sending its coastguards. Production is thus more symbolical than practical. The USA could also close the Strait of Malacca, through which about 80% of China’s oil imports flow through. It is not a risk China would dare take.
The likelihood of an oil war in the South China Sea is thus minimal, when considering the relative unimportance of the energy reserves held compared to China’s appetite, the “Malacca dilemma”, and the large challenges linked to extracting energy rents from the region. Perhaps in the future, China’s army may feel emboldened enough technologically to dare engage the USA and its allies, though we may hope that when this time comes, energy technology will have also advanced enough to allow China to meet its energy needs domestically and renewably.
Hernandez, Marco, Marcelo Duhalde, and Adolfo Arranz. n.d. “Belt and Road Initiative.” SCMP Graphic. South China Morning Post. https://multimedia.scmp.com/news/china/article/One-Belt-One-Road/.
Meierding, Emily. 2016. “Dismantling the Oil Wars Myth.” Security Studies 25 (2): 258–88. https://doi.org/10.1080/09636412.2016.1171968.
Metelitsa, Alexander, and Jeffrey Kupfer. n.d. “Oil and Gas Resources and Transit Issues in the South China Sea.” Issue brief. Oil and Gas Resources and Transit Issues in the South China Sea.
Odgaard, Ole. 2014. “China׳s Energy Security and Its Challenges towards 2035.” Energy Policy 71 (August): 107–17. https://doi.org/https://doi.org/10.1016/j.enpol.2014.03.040.
SCMP Reporter. 2019. “Explained: South China Sea Dispute.” South China Morning Post, February 16, 2019. https://www.scmp.com/week-asia/article/2186449/explained-south-china-sea-dispute.