High-Seas Energy Fight Off Malaysia Draws U.S., Chinese Warships

(Source Bloomberg)

Malaysia’s push to explore energy blocks off its coast has turned into a five-nation face off involving U.S. and Chinese warships, raising the risk of a direct confrontation as broader tensions grow between the world’s biggest economies. The episode began in December, when Malaysia’s state-run energy giant Petroliam Nasional Bhd. contracted a vessel to explore two areas in the South China Sea in its extended continental shelf. Those waters are also claimed by Vietnam and China, which immediately sent ships to shadow the boat. The situation took a turn for the worse on April 16 with the arrival of a Chinese surveyor known as the Haiyang Dizhi 8, which last year was engaged in a standoff with Vietnam over offshore energy blocks. The U.S. this week sent at least two warships within some 50 nautical miles of the Malaysian ship, according to defense analysts privy to the information who asked not to be identified. U.S. Secretary of State Michael Pompeo on Thursday accused China of “exploiting” the world’s focus on the Covid-19 pandemic with provocations in the South China Sea. In a statement issued on the same day he held a video call with 10 Southeast Asian foreign ministers, he said China “dispatched a flotilla that included an energy survey vessel for the sole purpose of intimidating other claimants from engaging in offshore hydrocarbon development.”

“The U.S. strongly opposes China’s bullying and we hope other nations will hold them to account too,” Pompeo said. The U.S. doesn’t take a position on territorial disputes in the region even while staking a national interest in freedom of navigation, which involves challenging any claims that aren’t consistent with international laws. As China gets more assertive in enforcing its claims, it’s increased the risk of a potential confrontation with the U.S. that could quickly escalate.