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Thread: China cut off exports of oil to North Korea

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    Default China cut off exports of oil to North Korea

    China cut off exports of oil to North Korea

    By Joseph Kahn The New York Times

    Published: October 30, 2006



    BEIJING China cut off oil exports to North Korea in September, amid heightened tensions over that country's nuclear and missile programs, Chinese trade statistics show.
    The unusual move - the figures show China sold no crude oil at all to its neighbor in September - reduced cumulative sales for the year by about 7 percent over the same period in 2005. China's oil exports to Pyongyang had been averaging about 50,000 metric tons a month this year.
    In September, China exported 125,185 tons of crude for a reported value of $62 million. All of that was exported to the United States, with North Korea receiving nothing.
    North Korea depends on China for up to 90 percent of its oil, much of which is sold on credit or for bartered goods, according to Chinese energy experts. Any sustained reduction could cripple its isolated and struggling economy.
    There is no clear indication that the September figures represent a policy shift on providing vital food and fuel supplies to its neighbor and Korean War-era ally. Pyongyang conducted a nuclear test on Oct. 9, after the period covered by the latest customs data.
    But North Korea tested ballistic missiles in July, defying sharp warnings from Beijing. China supported a United Nations resolution condemning the missile tests. It urged North Korea in the ensuring weeks not to take any steps that might "worsen tensions" in the region.
    Beijing did not announce a reduction in oil exports. The figures were released by China's customs administration. The drop in supplies to North Korea was first reported by Reuters.
    It was possible the statistics were an anomaly or that supplies were cut because North Korea did not need more oil in September. Officials at China National Petroleum Corp., which sells oil and manages an oil pipeline to North Korea, declined to comment on the matter.
    But several analysts said the reduction suggested that Beijing was using crude oil as leverage to pressure North Korea to resume negotiations over its nuclear program.
    "It is a sharp and sudden reduction at a sensitive time, so political considerations cannot be ruled out," said He Jun, an energy consultant in Beijing. "China could be sending a clear signal."
    If that analysis is correct, it suggests that Beijing may seek to punish North Korea, in ways both open and unspoken, in the aftermath of its nuclear test.
    Although China has long protected the North against outside pressure, analysts said the nuclear test surprised and angered the Chinese leadership.
    China took the unprecedented step of supporting United Nations sanctions on North Korea after the test. The sanctions restrict sales of military equipment to Pyongyang and allow inspections of North Korean cargo.
    Both China and South Korea, North Korea's main trading partners, have opposed restrictions on economic ties with Pyongyang. They have interpreted the United Nations sanctions narrowly and declined to interdict North Korea cargo at sea, as the Bush administration suggested might be necessary to prevent any exports of fissile material.
    But last spring Beijing followed the lead of the United States in freezing North Korea assets that the Treasury Department identified as connected to money laundering, Bush administration officials said. Chinese officials never announced that they had done so, suggesting that they were taking some tough actions quietly.
    Chinese experts on North Korea who participated in discussions of the nuclear issue with Chinese leaders earlier this month said that officials had discussed reducing oil shipments if North Korea continued to defy the outside world. Beijing's response would be especially sharp if North Korea conducted more nuclear tests or declined to resume negotiations about dismantling its nuclear program, the experts said.
    If Beijing was already using oil to warn Pyongyang in September, its response to the October test could be more severe, analysts said.
    North Korea also buys oil from Iran, shipped by sea. Experts said the volumes are limited, however, and that China remains the country's main supplier.
    Asean calls for new talks
    Southeast Asian leaders called Monday for the resumption of six-party talks aimed at resolving the standoff over the North's nuclear program, praising China's efforts to seek a diplomatic solution, The Associated Press reported from Nanning, China.
    President Gloria Macapagal Arroyo of the Philippines, who led the gathering of the Association of Southeast Asian Nations this year, said they discussed the nuclear issue during a one-day meeting with Prime Minister Wen Jiabao of China, agreeing on its importance for regional security. "We were impressed by the unanimity of every leader on the issue of North Korea and their resolve to work together to seek a diplomatic solution through the resumption of the six- party talks," Arroyo said.


    BEIJING China cut off oil exports to North Korea in September, amid heightened tensions over that country's nuclear and missile programs, Chinese trade statistics show.
    The unusual move - the figures show China sold no crude oil at all to its neighbor in September - reduced cumulative sales for the year by about 7 percent over the same period in 2005. China's oil exports to Pyongyang had been averaging about 50,000 metric tons a month this year.
    In September, China exported 125,185 tons of crude for a reported value of $62 million. All of that was exported to the United States, with North Korea receiving nothing.
    North Korea depends on China for up to 90 percent of its oil, much of which is sold on credit or for bartered goods, according to Chinese energy experts. Any sustained reduction could cripple its isolated and struggling economy.
    There is no clear indication that the September figures represent a policy shift on providing vital food and fuel supplies to its neighbor and Korean War-era ally. Pyongyang conducted a nuclear test on Oct. 9, after the period covered by the latest customs data.
    But North Korea tested ballistic missiles in July, defying sharp warnings from Beijing. China supported a United Nations resolution condemning the missile tests. It urged North Korea in the ensuring weeks not to take any steps that might "worsen tensions" in the region.
    Beijing did not announce a reduction in oil exports. The figures were released by China's customs administration. The drop in supplies to North Korea was first reported by Reuters.
    It was possible the statistics were an anomaly or that supplies were cut because North Korea did not need more oil in September. Officials at China National Petroleum Corp., which sells oil and manages an oil pipeline to North Korea, declined to comment on the matter.
    But several analysts said the reduction suggested that Beijing was using crude oil as leverage to pressure North Korea to resume negotiations over its nuclear program.
    "It is a sharp and sudden reduction at a sensitive time, so political considerations cannot be ruled out," said He Jun, an energy consultant in Beijing. "China could be sending a clear signal."
    If that analysis is correct, it suggests that Beijing may seek to punish North Korea, in ways both open and unspoken, in the aftermath of its nuclear test.
    Although China has long protected the North against outside pressure, analysts said the nuclear test surprised and angered the Chinese leadership.
    China took the unprecedented step of supporting United Nations sanctions on North Korea after the test. The sanctions restrict sales of military equipment to Pyongyang and allow inspections of North Korean cargo.
    Both China and South Korea, North Korea's main trading partners, have opposed restrictions on economic ties with Pyongyang. They have interpreted the United Nations sanctions narrowly and declined to interdict North Korea cargo at sea, as the Bush administration suggested might be necessary to prevent any exports of fissile material.
    But last spring Beijing followed the lead of the United States in freezing North Korea assets that the Treasury Department identified as connected to money laundering, Bush administration officials said. Chinese officials never announced that they had done so, suggesting that they were taking some tough actions quietly.
    Chinese experts on North Korea who participated in discussions of the nuclear issue with Chinese leaders earlier this month said that officials had discussed reducing oil shipments if North Korea continued to defy the outside world. Beijing's response would be especially sharp if North Korea conducted more nuclear tests or declined to resume negotiations about dismantling its nuclear program, the experts said.
    If Beijing was already using oil to warn Pyongyang in September, its response to the October test could be more severe, analysts said.
    North Korea also buys oil from Iran, shipped by sea. Experts said the volumes are limited, however, and that China remains the country's main supplier.
    Asean calls for new talks
    Southeast Asian leaders called Monday for the resumption of six-party talks aimed at resolving the standoff over the North's nuclear program, praising China's efforts to seek a diplomatic solution, The Associated Press reported from Nanning, China.
    President Gloria Macapagal Arroyo of the Philippines, who led the gathering of the Association of Southeast Asian Nations this year, said they discussed the nuclear issue during a one-day meeting with Prime Minister Wen Jiabao of China, agreeing on its importance for regional security. "We were impressed by the unanimity of every leader on the issue of North Korea and their resolve to work together to seek a diplomatic solution through the resumption of the six- party talks," Arroyo said.

    http://www.iht.com/articles/2006/10/30/news/oil.php




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    Default Re: China cut off exports of oil to North Korea

    Maybe that's why Lil kim apologized the other day.

    -Mal

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    Default Re: China cut off exports of oil to North Korea

    We need to be watching NK ports to see who is supplying them with oil, my bet is it is going to be Iran. NK gets the oil for supplies (nuke) it has sent Iran, Kim would never give up that easy.

    North Korea also buys oil from Iran, shipped by sea. Experts said the volumes are limited, however, and that China remains the country's main supplier.

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