China’s Energy Independence: Game Over for the West

There was a lot of pomp and parade in China earlier this month. Officially, it celebrated 80 years since Japan’s defeat in World War II.

But more importantly, it was to showcase the growing bond between India, China, and Russia. That sent heads spinning in the West!

Modi, Xi Jinping, and Putin were clearly enjoying each other’s company and were keen to make that clear to the world.

But between all the smiles and back-slapping, I think there was one key issue underpinning it all…

ENERGY

Energy remains China’s Achilles heel.

India, too, is dependent on energy imports.

While Russia is rich in fossil fuel resources.

That’s why, at the sidelines of the event, China signed a deal with Russia to develop a major gas pipeline connecting the two countries.

According to Reuters, Russia’s gas giant Gazprom will build a 2,600km pipeline through Mongolia to deliver gas to China.

But it’s not the first…

Another pipeline stretching over 5,100km connects gas fields in Russia’s Eastern Siberia DIRECTLY to Shanghai.

This pipeline delivers about 38 billion cubic meters, roughly 9% of China’s consumption.

At first glance, the China-Russia relationship is a match made in heaven:

China needs an abundant fossil fuel supply to power its manufacturing dominance, while Russia needs a non-Western-aligned buyer that won’t bow to US sanctions.

But it does come at a potential cost for China:

Cosying up to Russia leaves it Vulnerable.

Another pipeline will entrench Russia (further) as China’s largest natural gas supplier… Already, it supplies 25% of China’s needs.

As long as this relationship remains solid, that’s no cause for concern for China.

But historically, these two countries have shared bad blood.

As late as the 1960s, China and Russia duelled for nine months in the Sino-Soviet border conflict.

As China leans further into the Russian relationship, it is giving up its energy security by offering its northern neighbour more leverage.

Obviously, that won’t sit well with Beijing officials, no matter how much cheering the leaders from the two countries exchanged this month.

That’s why you should watch China closely.

In my mind, these are short-term deals before China achieves its ultimate goal:

Energy Independence

I’ve detailed the mega-dam project underway in China’s East, that’s set to become the world’s largest hydro-power operation.

But there’s perhaps something more critical happening behind the curtain in China’s path toward energy abundance.

It’s a story I’ve been following for several months now.

According to some sources, China is close to solving the riddle of a powerful source of NEW energy supply.

This is not a far-fetched idea; the country has just proven it with the first viable commercial-scale operation.

And if it can be ramped up to scale, quickly, well, it’s game over for everyone else!

You see, China already holds manufacturing dominance.

But if you add cheap, reliable, abundant energy to that equation, no nation is coming close to competing with China!

You need to pay attention to this critical development.

To find out more, I’ve just finished putting together a special report on China’s new energy breakthrough and how it promises to elevate the country’s economic dominance.

And why it will force ENERGY back into the equation for investors over the coming years.

You can access the full report here.

Until next time.