With circa $1.5 trillion in foreign reserves, Beijing is taking advantage of low oil prices and the global recession to gain long-term access to sources of oil and other minerals around the world. In recent weeks China has announced concluded or pending deals with Russia, Saudi Arabia, Brazil, Venezuela, and Australia. In most cases, cash-strapped companies and governments are more than happy to take China’s money and give highly favorable terms.

So far the $25 billion loan to Russia to be repaid with $20-a-barrel oil is the biggest deal signed this month. A similar sized deal for access to Australian ores is reported to be in the works. China’s President Hu visited Riyadh last week seeking more Saudi oil to fill his new strategic reserve. Brazil is reported to be well along in negotiations for a $10 billion Chinese loan to finance development of its deep-water fields. Brazil’s Petrobras has already signed an agreement to sell 60-100,000 b/d of crude to China and a second deal for an additional 60,000 b/d is said to be near.

In the words of one Chinese observer “”The global economic crisis has given China a rare, good opportunity to trade our abundant currency reserves for other countries’ oil resources.”

Some observers are skeptical as to how long these cheap oil deals will last after prices go higher. Moscow in particular has a very spotty record of adhering to agreements in recent years.