The world‚Äôs most contentious and strategic waterway may soon be in Southeast Asia. Oil from the Middle East and Africa that travels through the Straits of Malacca makes up¬†75% of oil¬†(paywall) consumed by Japan, South Korea, and Taiwan, and 37% of China‚Äôs demand. And that pressure isn‚Äôt going to ease anytime soon. China‚Äôs latest attempt to ease dependence on the waterway‚Äîa nearly 800-kilometer pipeline between China and Myanmar‚Äîis running into problems, according to an official who told Reuters that fighting in Myanmar would¬†likely push back¬†the first shipments of natural gas.
China‚Äôs $2.5 billion pipeline project is only one of several attempts to resolve what Chinese officials and energy security analysts have called the ‚ÄúMalacca dilemma.‚Äù The straits, a 1.5 nautical-mile wide sea lane near Singapore, are considered the second largest ‚Äúglobal choke point‚Äù after the Straits of Hormuz in the Middle East. This map from the¬†Oil Change project¬†at the Medill School of Journalism shows how they compare:
The Straits are about to get even more crowded: More oil and gas production in the US has meant that more oil exporters are¬†targeting new customers in Asia¬†(paywall), and more tankers are sailing for China and elsewhere in East Asia. Separatist movements and poorly monitored ports in Southeast Asia mean that maritime robbery and piracy will become bigger problems,¬†writes¬†Felipe Uma√±a for the Fund for Peace.
And while naval boats aren‚Äôt yet accompanying tankers through the waterway, Southeast Asian nations like Indonesia, South Korea, Vietnam and Singapore have been¬†ramping up defense spending, which grew 42% between 2002 and 2011, in real terms. President Barack Obama has also ordered more naval ships in the area, just as China is adding aircraft carriers and larger ships to¬†its navy. Against this backdrop, territorial disputes¬†over the Spratly Islands¬†in the South China Sea, believed to be home to oil and gas deposits,¬†are a simmering source of tension near the straits.
Chinese state media¬†said in 2004,¬†‚ÄúIt is no exaggeration to say that whoever controls the Strait of Malacca will also have a stranglehold on the energy route of China.‚Äù This is true not just for¬†China, but much of the rest of Asia, and is likely to be the case for the foreseeable future: The Myanmar-China pipeline will only reduce China‚Äôs dependency on oil transported through the straits from 37% to 30%.