China Goes After More Oil

petrochina china oil derricks

China’s sovereign wealth fund is spending more money on oil, purchasing 11% of a Kazakh oil producer for $939 million, the Wall Street Journal reports.

China’s investment strategy is to purchase real estate and oil companies and invest with hedge funds and money managers.

The nation’s various oil companies have been gobbling up oil like crazy, as we detailed here, spending close to $13 billion in the past year.

With all these purchases comes a backlash. Iraq might not let China participate in the next rounds of bidding on its oil fields because China is owner of an oil field in Northern Iraq’s Kurdistan region. China wants to bid on Nigerian oil, but the government is wary, since it will adversly affect Western companies.

This is why China is only making an 11% investment in the company. If it does too many big blow deals it could scare everyone off.

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