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While President Barack Obama and assorted leaders of the capitalist world bickered about the legality of air strikes on Syria, two leaders of the former communist world did commercial business at the G20 summit in St. Petersburg. Under the benevolent gaze of Presidents Putin and Xi Jinping, Gazprom and CNPC, the Chinese state energy company, signed up to a skeleton agreement to supply pipeline gas from Siberia to China.
The two sides today agreed the volumes, dates and payment terms of the "take or pay" deal but it leaves the big number outstanding, the price to be paid by China for 38 billion cubic metres per year of Siberian gas.
The cost of energy is very much on the mind of the Chinese President. Only yesterday, his vice-minister for finance told the world's media that China was opposed to military intervention in Syria – because it would lead to higher oil prices.
China has been boxing with Russia over gas imports for many years. While the Russian government has overcome its historic diplomatic antagonism towards its powerful eastern neighbour, Gazprom has been unable to impose on China the expensive terms under which it has for decades supplied European utilities.
Instead, China has been making friends with Russia's former central Asian satellites. On Wednesday, President Xi Jinping did a stopover in Turkmenistan on his way to St. Petersburg, attending the signing of a deal to buy an additional 25 billion cubic metres of Turkmen gas and another agreement under which CNPC would help develop a huge gas field with Chinese loans.
What we should take away from the Chinese President's behaviour is not just the amorality of a cynical totalitarian, but a nervous reluctance to acknowledge power and influence. China's Achilles heel is always energy – hence the need to thumb a nose at the Russian President with a shopping trip to Turkmenistan. But shopping for gas in Asian bazaars is an easy game; what frightens the Chinese is political chaos in the Middle East, more civil wars and disruption to the flow of crude oil to China.
Only a few years ago, China could rely on America to continue to police the troublesome Arab world with the carrot of petrodollars and the stick of aircraft carriers. Even now, the U.S. Fifth Fleet is reported to be positioning itself for cruise missile strikes from the Persian Gulf but the Chinese President can see that his American counterpart's resolve is weak, and his appetite for dangerous and expensive stick-waving lessening by the day.
U.S. commercial interest in the Middle East is not what it was. The petrodollar flow to the Arabian Gulf is dwindling as the output increases from the Bakken oil shales in North Dakota. In its place, Arab oil exporters are offered the petro-yuan, but behind the mercantile swagger, there is a policy vacuum. China's confidence in wielding its new commercial power is undermined by the fear that America's mighty stick might one day cease to protect the convoys of tankers sailing east of Suez.
The crass commentary from Beijing reveals two things: China is deeply worried about the continuing political chaos and carnage in the Arab world but it has neither the confidence nor the sophistication to accept any role in the region other than that of a shopper counting his coins. This posture is rapidly becoming untenable and it is undermining the credibility of Beijing's foreign policy. And as the Chinese official hinted this week; it could affect the global economy.
Carl Mortished is a contributor to ROB Insight, the business commentary service available to Globe Unlimited subscribers. Click here for more of his Insights .
Carl Mortished