US can afford Mideast turmoil, but can Asia?

By Ding Gang

Global Times, March 3, 2011

Middle East turmoil and soaring crude oil prices naturally make people think of the impact on the US economy.

The US is the world's largest oil importer and has seen the Middle East as the focus of its global strategy for many years because of this. It seemed like the US might panic over the changes.

However, this time the US did not panic. The events in the Middle East seems to be within US strategic parameters and some Americans are even very happy to see changes in the Middle East. One reason is that the US today is no longer as dependent on Middle Eastern oil, and the US economy's dependence on energy has been much reduced compared with 10 years ago.

The US economy has become more capable of enduring the instability in the Middle East, which brings more room for the operation of US strategy, enabling the US to influence and shape the Middle East more in accordance with their own values.

According to data from the US Energy Information Administration, at present, the US average import of oil is about 11 to 13 million barrels per day, ranking No.1 in the world.

However, the US oil import from the Middle East accounts for only 23 percent of the total, 11 percentage points of which come from Saudi Arabia. But the imports of Saudi oil have also continued to decline since 2000, and imports from the Persian Gulf have dropped by approximately one-third from their peak in 2001.

A recent analysis report by Standard & Poor says that if the turmoil in the Middle East continues, oil prices are likely to exceed $148 per barrel, the highest point in 2008, or even reach $200. But only after reaching $150 could it have a real impact on the US economy and cause the threat of recession. Before that, it might bring benefits to the US economy, such as making it more attractive to investors.

The current state of US oil imports can tell us something.

After 9/11, the US undertook a deep review of its Middle East strategy, attaching great importance to the problem that the US global strategy is restrained by the over-reliance on oil, especially Middle Eastern oil.

In the following strategic adjustment, the US has focused on two aspects: gradually reducing imports of crude oil from the Middle East and gradually reducing dependence on oil. It has made significant progress toward the first goal and it is still making efforts on the second.