Oil top of agenda as President Putin visits Beijing


Russian President Vladimir Putin has begun a three-day trip to China, which will be his first overseas visit since starting an historic third term last month.

He is set to discuss energy ties with Beijing and a group called the Shanghai Cooperation Organization (SCO).

The SCO is made up of six members, including central Asian nations like Tajikistan and Uzbekistan. The group controls oil and natural gas fields, as well as pipeline routes between China and Russia.

Russia is the world's leading oil producer and China is the largest consumer of energy. However, China's demand for oil from Russia has fallen in recent years, from 11% in 2006 to about 7% in 2011.

So with China seeking cheaper natural resources, how will this impact their trade relationship? Dr Youfa Liu, deputy head of China's Institute of International Studies in Beijing says they'll need to agree on pricing going forward.

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