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Leslie Chats with Michal Meidan on China's Energy Strategy, Geopolitics of Gas and Trade Wars
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Leslie Palti-Guzman speaks with Michal Meidan, Head of Gas Research at the Oxford Institute for Energy Studies. Together, they explore:
- 🇨🇳 China’s evolving role in the global #gas market: What kind of #LNG buyer is China becoming? How is it reshaping contract terms, #trading flows, and pricing power?
- 🔁 Resale of LNG cargoes: China’s flexible contracts and resale behavior are turning it into a potential swing supplier.
- 🤝 Washington-Beijing trade tensions: How LNG, technology and sanctions fit into broader trade and industrial competition.
- 📉 The future of Russian gas in China: the future of the #PowerofSiberia2 pipeline, leverage or bluff?
A must-listen episode for those tracking energy demand, gas trading trends, geoeconomics rivalry, and China’s influence over global flows.
📲 Listen now on Spotify, Apple Podcasts, YouTube, and all major platforms.
🔎 Search: “Energy Vista by Leslie Palti-Guzman”
#EnergyVista
#China
#Geopolitics
#EnergySecurity
#TradeWars
#LNG
#NaturalGas
#AIinEnergy
#USChinaRelations
#EnergyTransition
#GlobalEnergyMarkets
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Transcript
Intro
Introduction to Energy Expert Michal Meydan
00:00:31
lpaltiguzman
Welcome to Energy Vista. I'm your host, Leslie Palti-Guzman, and time for a new Energy Vista episode. It's October 17, 2025, and today I'm exchanging with Michal Meydan, Director at the China Energy Program at the Oxford Institute for Energy.
00:00:52
lpaltiguzman
Michal is an expert on China's energy energy system, investments, and trade. She testified in April again at the U.S. Congress.
00:01:03
lpaltiguzman
on China's domestic energy challenges and its growing influence over international energy markets.
China's Global Influence in Energy and Trade
00:01:09
lpaltiguzman
And we'll get to some of this in today's conversation. But first I wanted to highlight something I've been focusing on, which is, i mean, it seems that today it's all about China, whether it's, we talk about military power, industrial capacity, technology, ah geopolitics, of course, trade and in energy.
00:01:30
lpaltiguzman
um And those domains seem to be increasingly interweighed. And look at shipping, like the shipping industry, for example. Washington right now is investing investigating Beijing and unfair practices in shipbuilding and maritime logistics.
00:01:49
lpaltiguzman
And both countries are fighting this over, it's it's part of their geo-economic war, basically.
Impact of Sanctions and Supply Chain Resilience
00:01:56
lpaltiguzman
And just this week, ah as the trade war is ongoing, ah we've noticed that China has sanctioned the South Korean shipping company, Hanwha, for helping the U.S. to try to rebuild its ah shipping sector.
00:02:13
lpaltiguzman
And all this is is basically also interlinked with the commodity sector because the U.S. s is trying to rebuild its shipping industry, including for LNG tankers, for example, and really need South Korean ah help because and the U.S. over the decades has lost its non-how.
00:02:32
lpaltiguzman
And so, you know, allies like South Korea are going to be under pressure to decide, you know, in the next um few days, few months, like what to do with the sanctions, helping the U.S., continuing this alliance.
00:02:45
lpaltiguzman
The U.S. will have to also... um ah show strategic patience as it's rebuilt some of its ah supply chain. So all this for me really means that we're in for a couple of decades right now.
00:02:59
lpaltiguzman
ah You know, the U.S. is really showing um willingness to rebuild its supply chain, dominate AI, and to you know realizing that China has taken control over many of the, um you know with whether it's rare earth metal, but also able to control some of the commodities like LNG that we're going to discuss.
China's Gas Demand and Industrial Influence
00:03:21
lpaltiguzman
So, hi, Michal.
00:03:22
Michal
Hi Leslie.
00:03:24
lpaltiguzman
and So great to see you again on this podcast, because actually I realized that we discussed five years ago. It seems that time is yeah flying too fast. At the time, we discussed um the Belt and Road Initiative, the like China pledge on climate neutrality. But today we're going to focus more and on gas, LNG, geopolitics.
00:03:49
lpaltiguzman
We're going to discuss even the power of Siberia pipeline, the trade war between the US and China. So like looking at this year, um Chinese gas demand and especially LNG imports doesn't really seem to be on a linear growth.
00:04:06
lpaltiguzman
ah Earlier this year for a couple of months, actually, um imports were dropping. And like for me, it it might be a bit worrying for, you know, all this glut of LNG exports that we're building.
00:04:20
lpaltiguzman
For many years, China seemed to be the El Dorado, right? You know, like this ever growing market. Now we hear all about AI and this will absorb, you know, a lot of the gas.
00:04:31
lpaltiguzman
But so where do we stand right now for Chinese gas demand? How do you see the outlook? um and And what's the role right now in China?
00:04:40
Michal
It's great question to start with, although it's a big question. And you're right, it's interesting that China's gas demand this year is flat. If we're looking at overall gas demand sort of year on year, it is it was actually negative in the first half of the year, and now it's starting to pick up and and be flat.
00:04:59
Michal
um A number of reasons actually, and we have to bear in mind, first of all, that the biggest consumer of gas in China's industry, not power, which also relates to our conversation on ai But industrial activity has been relatively weak in a lot of the traditional gas consuming industries that are related to the property sector.
00:05:19
Michal
There's a massive slowdown in real estate in China. So things like cement and glass and those traditional industries are suffering a slowdown. The saving grace for gas consumption in industry over the past couple of years has actually been what the government calls the three new industries.
00:05:37
Michal
So EVs, batteries, solar panels, Those have been rising very strongly, but even there, there's a lot of overcapacity. The Chinese are talking about involution. They call it involution, not overcapacity.
00:05:49
Michal
But still, industrial activity has been slower this year.
Competition Between Domestic Production and LNG Imports
00:05:53
Michal
So that's taken a toll on gas demand. We had a warm winter. So again, that kind of took the edge off the first few months.
00:06:01
Michal
Gas and power is not as strong as it was last year because there's a lot of coal and renewables. And the big story for 2024 was gas and transport, where we had a lot of fuel switching from diesel to LNG.
00:06:14
Michal
That slowed down as well, in part because of the price differentials. So you've got a weaker demand outlook. And then when you look at the supply side of the story, the reason that LNG has been so weak, A is prices, B, tariffs on US LNG. So there is a kind of desire to move.
00:06:33
Michal
I guess if you look at the pecking order of the lowest cost supplies, domestic production is rising very strongly. um Pipeline flows from power of Siberia 1 are now reaching their capacity.
00:06:45
Michal
So all of that has meant that with a weaker demand growth, well, flat demand growth, You've had other supplies to meet that demand.
00:06:53
lpaltiguzman
Yeah.
00:06:54
Michal
LNG has been phased out and resold essentially to Europe.
00:06:57
lpaltiguzman
Yeah. So China basically on the supply side has many options, right? Different fuels, whether it's coal or energy, you know, in the mix with renewable increasingly higher and its domestic production is now competing with LNG imports basically.
00:07:15
lpaltiguzman
So like, correct me if I'm wrong, but the region, Sichuan, is where we have the shell gas and, you know, used to be known for its cuisine, but now increasingly more for shell gas. But is it realistic to think that Chinese production from this basin and other, you know, like domestic production will keep growing like this, like it has been ramping up?
00:07:37
Michal
sort of been the the gift that keeps on giving and the kind of ongoing surprise. um So thankfully Sichuan cooking is still very good and still very popular. I think what's been really interesting is how there's been a focus on the upstream, both in oil and gas.
00:07:53
Michal
And you looked at it. So in 2019, the government came out with like a seven year action plan to keep production going. And you looked at it and you thought, okay, the government says, but there's only so much that you can do.
00:08:05
Michal
depending on the geology, but kind of we're almost at the end of that seven year action plan. And we've seen Chinese domestic production go grow at seven, 8% every year.
00:08:16
Michal
Part of that is shale. Part of that is tight gas. A big part of that is actually offshore conventional, but offshore in the kind of Bohai Bay. um And the reason that it's been successful is not just because the government has said, but the government has given tax breaks and incentives to produce the harder um sort of patches.
00:08:37
Michal
The reality is that we don't have a huge amount of insight into the geology. so it's hard to tell how long this can keep going.
00:08:41
lpaltiguzman
Mm-hmm.
00:08:44
Michal
But from what we're seeing, there are very few reasons for the growth to stop.
China's Strategies for Energy Self-Reliance
00:08:50
Michal
And if you look at CMPC, which is the biggest Chinese oil company, if you look at their forecasts, they see de ah they see production, which is now in the 250 BCM range,
00:09:00
Michal
going and peaking in at 300 or 320 in the twenty thirty s So we've still got sort of almost 10, just under 10 BCM average annual growth just in production every year.
00:09:16
lpaltiguzman
So China seems to send like so send signals that they could become increasingly more self-reliant for natural gas, um that they their demand may peak at one point, you know, beyond 2030 plus.
00:09:33
lpaltiguzman
um And at the same time, they just signed this power of Siberia pipeline, you know, deal with Russia. yeah So do you think it's more a negotiation ploy as China and the U.S. s still negotiate their trade deal, many other issues? There is a war in Ukraine, this kind of um reconfiguration of trade flows and alliances.
00:09:55
lpaltiguzman
And, you know, Russia and China, two large landmass countries, actually have this advantage of they can trade together building pipelines rather than going through the sea. like How do you see this pipeline announcement recently?
00:10:11
lpaltiguzman
Do you think it's a bluff or do you think it's going to materialize at one point?
00:10:16
Michal
Yeah, it's been fascinating. Like the September geopolitics and realignments in in energy have been really, have been really fascinating. I think, first of all, it's important to keep in mind 60% of China's gas comes from domestic production.
00:10:32
Michal
You know, China is the fifth largest gas producer in the world. So it does.
00:10:36
lpaltiguzman
Yeah, I think now it's, yeah, almost like the size of the whole African continent, like what the whole African continent is producing. Yeah, huge.
00:10:44
Michal
So, you know, it's not a small producer, but obviously demand is so is so strong and rising so strongly. i think the demand side is really important. We talk a lot about supply and we'll talk about a second.
00:10:55
lpaltiguzman
Hmm.
00:10:56
Michal
But the kind of variation in forecasts of where China's gas demand is going to peak range from 550 five hundred and fifty bcm So demand today is ah or was and just under four hundred and thirty bcm the forecasts go from 550 sort of peaking at around 550 in the mid 2030s to some analysts that say it's gonna peak closer to 700 towards the 2040s. That's a massive variation in your demand outlook, which obviously has on one hand a lot of potential, but on the other hand, just creates a lot of uncertainty. So that i think is also important to bear in mind.
00:11:37
Michal
The power of Siberia too, from what we know, right? The only things we know came from the Russian side, from CEO Gazprom, from Gazprom CEO Alexei Miller, who said that there is a mutually binding agreement to do who knows what, right? It just sounds like there's an agreement to keep talking.
00:11:57
lpaltiguzman
It seems the best opportunity for Gazprom to avoid bankruptcy too.
00:12:02
Michal
It's a good way, right, to get financing.
00:12:02
lpaltiguzman
but
00:12:05
Michal
I think it is significant in that it was also announced by Putin or sort of there were statements around power of Siberia too. So we kind of know that there's a desire to keep negotiating it.
00:12:17
Michal
We know that the Ruva, Mongolia that was contested is the likely one. And we know that they're planning to price it in ruble and yuan rather than dollars or euros.
00:12:28
Michal
We don't know.
00:12:30
lpaltiguzman
Mm-hmm.
00:12:30
Michal
the pricing structure, we don't know the terms of flexibility, and we don't know the start date. So in that respect, the project has always been on the table, right? It's been negotiated for the past decade.
00:12:42
Michal
um We have it in our balances. To be fair, we have it starting up in the mid-2030s. I know lots of other analysts that are assuming that it happens in the 2030s. So in that respect, there's nothing new, but the announcement is significant.
00:12:57
Michal
um Because at least up until now, the Chinese, they had a number of reservations. One was price. And again, we don't know what the price is. The second was that if they do power of Siberia too, when you add power of Siberia one and right, they announced a few expansions of existing pipelines or contracted pipelines.
Geopolitical Implications of Russia-China Energy Relations
00:13:17
Michal
When you add all of the existing and potential supplies, both pipeline and LNG, Russia could account for almost 40% of China's imports, which is a lot.
00:13:29
lpaltiguzman
Mm-hmm. Mm-hmm.
00:13:29
Michal
And the Chinese have been really reluctant to be overly reliant on any one partner.
00:13:32
lpaltiguzman
but
00:13:33
Michal
We see it in oil, we've seen it in gas. So that's the first thing that sort of does this mean that China's willing to tie itself more closely to Russia? The second thing that was interesting was that the Chinese were holding off on some of these negotiations, in part because of European concerns about support for Russia,
00:13:54
Michal
following the Russian invasion of Ukraine now obviously China has been supportive of Russia, but they've never gone as far as saying, we're not just siding with Russia, we're financing Russia.
00:14:05
Michal
And in August, September, what they did was a take cargoes of sanctioned Arctic LNG to LNG and announced well, not announced, but supposedly announced
00:14:16
lpaltiguzman
That was interesting because it's it it happened at the same time Putin was in within Alaska, right?
00:14:22
Michal
Exactly. It was sort of after Putin.
00:14:23
lpaltiguzman
Yeah.
00:14:24
Michal
So it's sort of saying to the West, you know what, we hear that you have these sanctions, but we don't really believe you're going to enforce them.
00:14:31
lpaltiguzman
No.
00:14:31
Michal
And we're happy to help finance Russia, which is a pretty strong geopolitical statement. Now, does it change market balances? I think not. I think it doesn't move the needle on the projected supply and demand of China in the future, but it does give China optionality. And I think that's the interesting thing that it could have a bunch of supplies of gas.
00:14:54
Michal
And again, we don't know how much that's priced at a sort of X market price in different commodities and just gives a lot of optionality because i think there's a real potential that the Chinese gas market is oversupplied 10 years.
00:15:09
lpaltiguzman
Yeah. And in in this case, I think it would put China in the best position to become an exporter of LNG, actually.
00:15:17
Michal
Yeah.
00:15:17
lpaltiguzman
And in this case, yeah, control more the market.
00:15:19
Michal
yeah and
00:15:22
Michal
it's already retrading a lot of lng and i think it is now some caveats because the domestic system and prices and flexibility is not perfect but they kind of have 10 years to get there but the point is that they have optionality on a number of fronts and they also have and i think you're right on your point about leverage um maybe it's with the us
00:15:24
lpaltiguzman
Right.
00:15:34
lpaltiguzman
Yeah.
00:15:46
Michal
negotiations, but also, you know, they can come to their existing partners now and say, you know what, we're going to have all this gas from Russia, that's going to be priced at five to $6 per MMBTU.
00:15:58
Michal
Give us a better price on our LNG.
00:16:00
lpaltiguzman
Yeah, what was interesting is that they have already renegotiated a contract with Australia before the announcement of the power of Siberia.
00:16:00
Michal
Let's read
00:16:07
lpaltiguzman
And it was at the time where everybody was like talking about the drop of Chinese gas demand. And and and for me, like all those announcements about weak Chinese demand actually...
00:16:19
lpaltiguzman
um fits a purpose for China because it it gives them a ah the upper hand potentially in negotiations to renegotiate contracts and to announce to the world also this big giant pipeline of 50 BCM a year um for me has a strategic, it's a strategic communication also to maybe paralyze investments in other
Shifts in China's Energy Infrastructure Priorities
00:16:45
lpaltiguzman
jurisdictions. So it didn't work for the US so far because we've seen since the announcement of the power of Siberia pipeline, additional FIDs taken for US LNG export projects.
00:16:55
lpaltiguzman
ah But it could you know delay some projects in Mozambique, ah the outlook also for Alaska LNG. I mean, you know the world is not going to be able to absorb in 10 years from now or more such a big amount of supply.
00:17:12
lpaltiguzman
ah from you know The U.S. is doubling its liquefaction capacity within you know by then the end of the decade already. So huge amount of gas coming into the market.
00:17:23
Michal
And I think the upside, even from that cheap gas is relatively limited. Yes, China could consume more gas at lower prices. doesn't matter where from.
00:17:34
Michal
um But there's only so much more gas that it will consume a because the domestic pricing mechanism is set by the government. So there's not full pass through of low costs, because they do worry about reliance on imported gas, but also because they've got coal and renewables.
00:17:48
lpaltiguzman
Mm-hmm.
00:17:50
Michal
So when you think about the cost of gas, you have to think about the cost of alternative fuels in China. which are falling rapidly. You know, some switching happens now because you have, you can use more gas and power or, you know, you can have high utilization rates on some industrial applications.
00:18:08
Michal
But in five years time, is the government going invest in infrastructure to have more gas? Or is it going to invest in more infrastructure for electrification, um which relies on coal and renewables, which are domestic sources and more secure? So I think There is upside, and I think this year is a bit of an outlier with flat gas demand.
00:18:29
Michal
you know I think China does go back to growing 15 to even 20 BCM a year.
00:18:29
lpaltiguzman
Mm-hmm. Mm-hmm. Yep.
00:18:35
lpaltiguzman
yeah
00:18:36
Michal
but you have some market projections that talk about much more than that.
00:18:40
lpaltiguzman
Yeah. So in this context, you know, the Chinese market for USMNG was like below 5 million tons last year. It's not a big market. ah It was the highest in 2021, almost 10 million tons, just after the two countries, um you know, agreed to find a trade agreement.
00:19:00
lpaltiguzman
And it never, you know, recovered to those levels. Now we're ah zero so far this year, almost. um Since February, China has not imported any single US energy cargo.
00:19:13
lpaltiguzman
Trade discussions are ongoing. um Do you think both countries could save the face and agree on for China to import again energy? How do you see it?
00:19:25
lpaltiguzman
How do you see it?
00:19:27
Michal
I think they could make announcements about additional imports, but the reality is that until the tariffs are lifted, there's no big incentive to actually bring those flows to China. Now, let's see where tariffs go,
Tariffs and U.S.-China Energy Trade Challenges
00:19:39
Michal
right? We have now a potential threat of 100% tariffs imposed by the US on China in November.
00:19:47
Michal
If China reciprocates, then you know then there's no chance for LNGP. As long as tariffs are 15%, there's a scenario in which low cost sort of cheap US gas that is actually competitive in the Chinese system. But so first of all, question of what happens with tariffs, it's fine to say yes, on paper, we're going to buy more.
00:20:08
Michal
The other reality, of course, is that US contracts are very flexible. So the Chinese can find agreements and then resell them. um There is a bit of a risk in that strategy because if the market is globally oversupplied, then they could be stuck with some of those cargoes.
00:20:25
Michal
I think overall there's relatively limited appetite for additional LNG investments. I think if there is a trade deal or deliverables from a potential meeting between Trump and Xi later this month, it would probably be on the ag stuff on soybeans rather than and and g It's a nice face saving way, but I think the reality is that it's going to be hard for US LNG with the current tariffs and maybe higher tariffs to be to go into the Chinese market.
00:20:54
lpaltiguzman
You know, I was discussing with somebody who knows a lot about shipping, and he pointed to the fact that ah China is not owning or building much vessels in general that are LNG propelled.
00:21:08
lpaltiguzman
And one of the reasons could be that they don't want to give... to open this market to the US. Since China now is a big chip builder, um not yet dominant on the LNG tanker side, but many other segments of the shipping industry.
00:21:25
lpaltiguzman
um you know they are Everybody is looking at alternative fuels to propel vessels in general. And LNG is the one that is the commercially available right now, ah proven technology,
00:21:38
lpaltiguzman
Others are working on the future of methanol and ammonia and other things like that. But like right now, LNG is the one that could be, you know, this kind of alternative fuel. And it seems that China has not really done anything much regarding this.
00:21:54
lpaltiguzman
Do you see it as a way to actually compete with the U.S. and not give the U.S. too much, you know, market for its LNG, basically?
00:22:05
Michal
I think there might be an element of that, but I think it's also relates to two other factors. One, mean, you remember the IMO discussions like COVID?
00:22:13
lpaltiguzman
Yeah. ah
00:22:15
Michal
That's all we were talking about. Like what would happen when IMO would hit? But even then there was a bit of skepticism whether LNG would be the fuel of choice or whether you'd have scrubbers installed and, you know, desulfurization of fuel oil. And I think that was still a bit of a hesitation in the industry on whether you actually invest in and lng So I think it's a little bit of manifestation of that.
00:22:39
Michal
But also, China has a lot of renewable capacity that is well curtailed or it's excess renewable capacity. They're doing a lot of green methanol because they have a lot of renewables that can't access the grid for a variety of reasons.
00:22:55
Michal
they're actually going to green methanol and other solutions that they're trying to develop so i think the combination of i guess the opportunities and then maybe also not seeding ground but also i remember they don't they haven't been the leaders in lng technologies on anything like they haven't been the leaders in um in gas plants in which has been another reason why they you know gas
00:23:00
lpaltiguzman
Mm-hmm.
China's Renewable Capacity and Alternative Fuels
00:23:20
Michal
We talk about really big numbers, but gas in the Chinese energy mix is 10%. In the power sector, it's 6% of installed cap capacity. Because when you think of coal and renewables that are big industries in China, either on the production side or or on the equipment side, then gas loses on all counts.
00:23:40
lpaltiguzman
Yeah. So we cannot leave this discussion without talking about AI.
00:23:43
Michal
Okay.
00:23:44
lpaltiguzman
And you mentioned it already a little bit. um For electricity, gas is not really, you know, the place where, you know, for increased ah reliance on electricity to power EVs or to power AI, like China is is looking at coal and renewable, basically the combination.
00:24:02
lpaltiguzman
So it's very different from other regions right now where, you know, in the U.S., everybody talks about gas turbines, right, and new power plants additional pipelines and transmission lines that we need to bring this electricity or co-locate because we don't have enough transmission line and so on So how do you see this kind of, you know, divergence between markets?
00:24:23
lpaltiguzman
Europe also apparently is going to really, like right now, and um electricity in Europe is not really growing, but we'll eventually grow based on AI and projections. I read as much as 70% increase by 2030. It seems very a lot, but we'll see.
00:24:38
lpaltiguzman
And so all those data centers will need to be powered by something. like Can you tell us a little bit how you see China positioning itself in this race?
00:24:47
Michal
I think certain degree, the debates are similar, right? It's the electricity demand and how do you ensure electricity demand? Where do you locate the industries? Do you have the physical infrastructure? What are the implications for, you know, the cost of electricity for consumers?
00:25:03
Michal
Those are all very similar debates, except that, as you pointed out in China, The electricity system is all about coal renewables and to a much less degree gas.
00:25:12
lpaltiguzman
Nuclear, ah yeah. Not nuclear, yeah.
00:25:15
Michal
There's new hydropower.
00:25:17
lpaltiguzman
yeah
00:25:18
Michal
So the growth and and, you know, China power demand grow sort of power is growing. Power demand is growing and around roughly in line with GDP. And actually for the five years up until now, it was growing faster than GDP because of broader electrification, electric vehicle penetration, but also AI data centers,
00:25:38
Michal
A bit like many other parts of the world, it's also very local, right? It's very regional. um There are plans to sort of build data center clusters that are linked to the renewable bases and clusters in kind of northwestern China in the big renewable bases.
00:25:56
Michal
Not all of that is going to be possible and realistic because some data centers actually need to be close to the demand centers and the consumer centers. So for some of them actually along the coastal provinces where gas is a big part of the power system, um we could see sort of more demand from gas.
00:26:15
Michal
And I think especially if we get a glut of LNG and sort of lower cost gas and that can feed into that electricity demand. um But overall, I think it's sort of going to be a marginal story for gas. AI is going to be big in China. and We go to all those questions, right, of,
00:26:33
Michal
A, how do you feed demand for AI, but B, what are the implications of AI for energy efficiency and and better use of electricity?
Western Supply Chain Vulnerabilities and Strategy
00:26:42
Michal
That is all relevant for China too, and the kind of locational questions.
00:26:47
Michal
It's just not the big gas story that it is, or at least the gas players are saying that it is in the West.
00:26:54
lpaltiguzman
Yeah. Right. Yeah. So I opened my remarks at the beginning about talking about shipping, because I think it's an illustration of, you know, a lot of the different dynamics we see nowadays, um you know, on on the industry, the AI, you know, with methyl and controlling and securing the supply chain.
00:27:17
lpaltiguzman
So over the years, the West, and especially the U.S., has ceded lot of market share and basically almost the whole, you know, shipbuilding to Japan, South Korea, and more recently China.
00:27:32
lpaltiguzman
And I think the U.S. has been realizing for the you know recent years that it's a big vulnerability because there are... um some kind of transfer between also the military and the commercial side of shipping. And if you lose all your know-how and expertise on building ships for commercial, it's also um translating into the the military side.
00:27:57
lpaltiguzman
So now the U.S. needs to rebuild eye alliances. South Korea is going to be one. And, you know, it's part also of the trade deal between South Korea and China. But we just saw that China is now pressuring South Korea by sanctioning Hanwha, one of the largest shipbuilders in Korea.
00:28:11
lpaltiguzman
So, you know, like I feel on the trade side and the geoeconomics is going to last for years, right? Like we're going to sit sit for that. And so it's never, you know, like I don't see the end of those kind of rivalries.
00:28:26
Michal
No, I agree. And I think beyond that, the sort of implications of that tit for tat is going to take not a lot of time, but every day or every week, we're going to see the unintended consequences of or how these things unravel um because they have such knock on effects on everything, right? So the the kind of having ceded ground to China, it was maybe in a different era when we thought the globalization was a great thing or when the everybody commonly assumed the globalization when a good was a good thing.
00:29:00
Michal
The fact that a lot of manufacturing moved to China Part of it was because some of these things were energy intensive, inefficient and polluting, especially when you think about some of the critical mineral processing.
00:29:07
lpaltiguzman
Mm-hmm.
00:29:11
Michal
We were very happy in the West to outsource that to China to see cost reductions, you know scale improvements and therefore cost reductions. A lot of what China's done has enabled the energy transition with lower cost solar panels, wind turbines, electric vehicles and batteries.
00:29:27
Michal
when we look at it from an industrial perspective, then we've lost a lot of competence know how skills. I think where China's interesting is that it's not just about we focus on state subsidies and how the government, you helps companies, but they've also developed really, um,
00:29:46
Michal
comprehensive ecosystems that are able to build and manufacture and process innovation and efficiency gains. That just means that it's quick, it's cheap, and it's relatively efficient to produce things in China.
00:29:59
Michal
Now, breaking that up or trying, well, trying to replicate that, I think is going to be harder than people think, because China's advantages are not just state subsidies or cheap electricity.
00:30:11
Michal
It is all those ecosystems of knowledge and skills and supply chains, that it is gradually nationalized as well, so it has sort of actors in shipping and trading and in all of that, so it's going to be much harder to disentangle and it's going to put a lot of countries in that position where they have to choose sides, which increases costs and complicates matters.
00:30:33
lpaltiguzman
Yeah. Yeah.
00:30:34
Michal
i think
00:30:34
lpaltiguzman
I think for the US, you know, the goal is not maybe to control the whole, whole value chain. I think the first LNG tankers, for example, agreed with Hanwha shipping will be built in Korea.
00:30:46
lpaltiguzman
There will still be some transfer of technology and... ah training for US workers and you know labor is going to be so important in that regard and increasingly in trying to gradually reduce the costs.
00:31:00
lpaltiguzman
um As we know, like right now in this administration, there are many contradictions in the agenda. um you know The tariffs on steel is not going to help out necessarily. ah hard policies on immigration visa, like for yeah workers that potentially have those skills also. So I think there is a need for alignment ah between different departments in the US, agencies, and also many strong alliances with capable partners.
00:31:27
lpaltiguzman
like Japan or South Korea, for example. um But I think it's still worth trying to do it, even if it's going to take decades, just because it puts you know the US and the value chains that the US, even commodities you know like LNG exports potentially at a risk in time of wars or just you know big crisis like we saw during COVID, like you want to be in control and um of your supply chains.
00:31:54
lpaltiguzman
Yeah.
00:31:55
Michal
And I think beyond the control of supply chains, we want geographic diversification. And if we've learned anything during COVID is that redundancies and available supplies and different geographies and different sort of know how in different geographies is a good thing.
00:32:11
Michal
But it is a mindset shift, right? It's sometimes you have to backstop or financially de-risk some of those investments.
00:32:13
lpaltiguzman
Yeah.
00:32:17
Michal
So you're not going to get the cheapest. You're not, you might, you know, you need to move away from these kind of just in time supply chains to redundancies in your supply chains. And that's a different mindset, you're gonna have to do industrial policy like China does.
00:32:32
Michal
And that's a very different mindset.
00:32:34
lpaltiguzman
Yeah.
00:32:35
Michal
And I agree with you, it's all useful. But I think what Europe and the US need to do is prioritize, we're not going to be able to redo all those supply chains.
00:32:41
lpaltiguzman
Mm-hmm.
00:32:44
Michal
And to reach your French or nearshore, you have to pick the strategic objectives and focus on those and then go from there. And I'm not sure we're doing that, especially with all these conflicting agendas and priorities.
Michal Meydan's Role in Energy Education and Future Outlook
00:32:58
lpaltiguzman
yeah Yeah, it's only the the beginning of this trying of renaissance of shipbuilding in the US s and in Western Europe. So we'll see. and But Mirra, let's move to um a question and more on your personal professional trajectories.
00:33:18
lpaltiguzman
So you recently um announced a new position as an advisor at Sciences Po, where actually we both studied. i did a mess what bachelor and master's degree, and you did a PhD there in Paris.
00:33:31
lpaltiguzman
And you are going to teach also. So teaching um is going to be new for you. How do you feel about it And are you excited about it?
00:33:40
Michal
super excited actually it's a privilege to go back to well both of our alma mater science poor is still yeah um and it's in you know the sixth in paris so not a bad place to to have to be in for a few days a month um but beyond that i think it's really it's fascinating and it's exciting first of all have to try and think through
00:33:46
lpaltiguzman
Yeah.
00:34:08
Michal
The energy system my courses sort of dilemmas of the energy transition so to think through the energy system, how to convey some of those issues in a balanced and impartial way.
00:34:20
Michal
um To students who are going to be making their careers and energy, and then I think even more. interestingly, is to be challenged or confronted or hear their questions and their perspectives and sometimes have to rethink um the way I see things or the way I think about things and just be, you know, engaged with the, I guess, younger generation of energy professionals is really, really cool.
00:34:45
lpaltiguzman
Yeah. Yeah. you'll You'll tell me if you see like some people more ah hopeful, realistic, pragmatic, or, you know, environmentalist, hardcore. Like you'll tell me if there is a diversity in and the mix.
00:35:02
Michal
I think the beauty so far, I've had a few sessions with this cohort, is that they are very optimistic.
00:35:08
Michal
I love that. i hope I hope it rubs off.
00:35:08
lpaltiguzman
Okay, good.
00:35:11
lpaltiguzman
Yeah, I mean, the apocalyptic, you you know, doomers are the worst, I think, because it puts us in the position of inaction so much, you know, there is pessimism. OK, you know, if it's if we're doomed, let's do nothing and wait. Right.
00:35:24
lpaltiguzman
And on the contrary, I think you know I'm a big believer in technologies to solve many of the you know, climate issues. and And, you know, I think we need great minds to understand all those complexities also but between all those different fields, actually, because energy, as we know, it's a mix of finance, geopolitics, technology, you know all of it.
00:35:44
lpaltiguzman
um So great. Well, that's amazing.
00:35:47
Michal
And you've done great contributions with technology and understanding. so you know,
00:35:52
lpaltiguzman
Yeah, yeah. Yeah, yeah. the The platform we built with, you know, it was a mix of ah AI machine learning to to anticipate flows of commodities and predictions. So allied with some technologies like satellite imagery and AIS, like the pulse that tankers emit. And, you know, it it was like um ah good um a good way to touch on all those different sectors also. Yeah.
00:36:19
lpaltiguzman
Good. Well, thank you so much for joining the conversation, Michal. And we'll be in touch for to see what's going on with China in the next few weeks. And the um you know um Trump and Xi are supposed to meet soon.
00:36:32
Michal
Yeah, well, thanks for having me. And i hope it's not five years till we speak again.
00:36:36
lpaltiguzman
Yes.
00:36:41
lpaltiguzman
This is Leslie Pelti-Guzman. The podcast was recorded on October 17, 2025. This is Leslie saying goodbye goodbye and good luck.