OPEC meets in Vienna this week with most analysts predicting the cartel will leave its daily production target unchanged at 21.7 million barrels of oil per day (bopd). This is almost 20% or 5 million bopd less than OPEC's target 18 months ago.

Despite this significant supply reduction, oil remains plentiful with few analysts expecting the existing strength in the oil market to hold and suspect prices will ease back below $US25 bbl.

One nation that is keeping a close eye both on oil prices and the Middle East is China. Despite a long-standing desire to be self sufficient in energy, the Middle Kingdom is finding itself becoming increasingly dependent on the Middle East as gas demand outstrips domestic supply.

According to US Energy Information Administration, China's oil consumption is likely to increase from 4.78 mmbbls per day in 2000 to 10.5 mmbbls per day by 2020.

Based on current trends, analysts say China will need to import about 60% of this projected demand, with most of it sourced from nations such as Saudi Arabia, Yemen, Iran and Oman.

While this may make China a dominant player in the world energy market, it would also make China vulnerable to supply disruptions or political manipulations.

About 60% of China's imported oil last year came across the Indian Ocean and through the narrow and easily blockaded straits around the Indonesian archipelago before entering East Asian shipping lanes.

No doubt China fears the might of the US Navy, which could easily disrupt China's energy supplies by enforcing sanctions in the event of a dispute or conflict between the two superpowers.

China has sought to increase its energy security by investing heavily in foreign oil and gas fields, engaging in dialogue with emerging energy power Russia, and planning to build strategic reserves as well as shifting energy demand toward gas