Chinese premier Wen Jiabao says not worried about oil trade with Iran

Doha (Platts)--18Jan2012/815 pm EST/115 GMT

Chinese Premier Wu Jiabao said Wednesday after talks in Qatar that China was not worried about its oil trading with Iran and while Beijing is opposed to a nuclear-armed Iran, the business of international trade should not be disrupted.

Speaking at a news conference in Doha, the last leg of a tour of key Arab oil producers in the Persian Gulf, Wu also said that Qatar and China had agreed to establish a petrochemicals joint venture in the Chinese province of Taikyu and wanted to set up a long-term relationship to develop natural gas.

Wu gave no further details about the plan nor was there any comment from Qatar, the world's biggest LNG exporter and holder of the world's third biggest natural gas reserves after Russia and Iran. .

"China rejects Iran's efforts to develop nuclear weapons as totally unacceptable and calls for a nuclear-free Middle East," Wu said through an interpreter. "Our position is very clear on this and we support mediation efforts and dialog between the five plus one world powers in order to reach a swift and peaceful resolution to this issue."

"We have normal trade relations with Iran but we will not make deals that go against our principles," he added, referring to US efforts to convince China, which buys some 20-22% of Iran's crude oil exports, to cut its imports of Iranian oil.

Wu said that China had voted for UN sanctions against Iran and would abide by these international sanctions and would not violate them.

Asked about the potential for conflict in the Persian Gulf as a result of Iranian threats to shut the strategic Strait of Hormuz waterway, Wu said that the security of the waterway through which 20% of the world's traded oil transits was in everyone's interests.

"Everyone is concerned about the security of the strategic Strait of Hormuz and securing the strait and oil tanker traffic concerns the whole world," the Chinese premier said, adding: "Any extremist actions in this area ?ran? counter to the will of the international community."

As for the expected EU embargo on Iranian crude oil exports, Wu again repeated his position that China would abide by the four sets of UN sanctions imposed against Tehran -- targeting its oil sector and financial institutions -- over its controversial nuclear program.

"At the same time, I stress that the question of trade, including oil trade, is part of normal trading relationships and China is not the only country that is trading with Iranian oil ... I am not worried about the oil trade between Iran and China," he said, adding that the issue was not discussed during his visits to Saudi Arabia and the UAE.

China is the biggest foreign investor in Iran and stepped in to fill the gap in Iran's oil sector after Western oil companies pulled out.

--Staff, newsdesk@platts.com

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