On May 25, 2015, the First Annual Conference of the Non-governmental Forum of the Conference on Interaction and Confidence-Building Measures in Asia (CICA) was held in Beijing. Experts and scholars from many countries had discussions on energy security. All countries are concerned about their own interests; however, each country has its own worries due to different circumstances.

There are many factors that cause energy insecurity, which can be roughly summed up in four categories:

The first category is related to energy output, transportation and consumption, which can be regarded as material energy insecurity. In particular, it can be expressed as whether there are threats to energy output stability, energy transport convenience, and availability of energy for consumption.

The second category is related to supply and demand uncertainty and trade cost. Since this factor is closely related to agreements and contracts between countries, it can be regarded as system-type energy insecurity. The difficulty of signing and implementing contracts in the energy sector will lead to higher transaction cost to respond to opportunistic behaviors. There is still a long way to go to establish international governance in the energy sector.

The third category is related to the volatile finance market. About half of energy trading today, especially in oil, is conducted in futures markets. However, high leverage and strong speculative forces exist in the futures market. It is sensitive to and dependent on U.S. monetary and financial policies as well as international capital flows, and can be greatly impacted by the geopolitical situation.

The fourth category is related to human attitudes and behavior. Experts from many countries focus their attention on the international energy security that is subject to relations between states. Such relations are complicated, mainly due to the fact that all the "players" want to maximize their own national or business interests, and that competition will lead to conflict.

Appropriate measures should be taken to reduce energy insecurity. Adequate investment, particularly investment in related technologies is essential. Multi-transport channels and means of transportation must be established. All countries should strive for geopolitical stability and respect contracts that have been signed. Monopolistic behavior cannot be tolerated in the energy market. The energy-related financial market must be strictly regulated. The formulation and implementation of monetary policy in major countries should take the energy market into consideration. Mutual trust between nations should also be improved.

This article was edited and translated from 能源不安全感从何而来, source: People's Daily, author: Zhang Yuyan.