China, Vietnam clash over South China Sea exploration

Vietnam accused China on Wednesday of seriously violating its sovereignty, after the state-owned China National Offshore Oil Corporation (Cnooc) invited foreign companies to bid for exploration in an area of the South China Sea claimed by Hanoi, Financial Times reported. Vietnam said the tender infringes on blocks that it has already licensed to Exxon-Mobil (XOM.NYSE) and Russia’s Gazprom (OGZD.LSE, GAZ.FSE). Analysts said the move amounted to an escalation of the long-running dispute, since China’s top leadership would need to “sign off” on Cnooc’s tender. Laban Yu, an analyst at Jeffries, wrote that the bidding process had been “commandeered by China’s Ministry of Foreign Affairs to use for political posturing” and that international oil companies would likely steer clear of it. China claims sovereignty over almost the entire South China Sea, while Brunei, Malaysia, the Philippines, Taiwan and Vietnam also make claims over all or part of it.