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China's Crude Oil Import to Break 100 Mln Tons This Year

According to an analytical estimation by Ministry of Commerce China's crude oil import will for the first time break through 100 million tons this year to hit a record of 110 million tons, a year-on-year increase of 21 percent. The import of refined oil is to reach 40 million tons, a rise of some 40 percent.

As the customs statistic indicates: the import of crude oil in the first half of the year reached 61.02 million tons valued at USD15.169 billion, which was a respective increase of 39.3 and 57.4 percent. The import of refined oil reached 19.85 million tons at a value of USD 4.457 billion, witnessing a respective increase of 56.6 and 66.1 percent. The total imported value of the crude and refined oil in the first half of the year added up to US$19.626 billion, taking up 7.4 percent of the country's total imported value and a rise of US$7.306 billion  as against that of last year.

The analysis of the Ministry of Commerce holds, affected by many such factors as the global economic recovery, OPEC output reduction and unstable situation in the Middle East the later half of the year will see the oil to maintain a high price in international market. As the state has adopted the macro-control measures the intensive situation for the supply of crude and refined oil will in somewhat way be eased at home market while the import of crude and refined oil will decrease a little bit in the later half of the year. However, the increase of import value will be bigger than the import amount.

Experts concerned are of the opinion that the continuous big increase for the import of crude and refined oil at a high price level will be sure to cause some negative impact on the balance of trade, industrial production and transportation cost and operation of national economy.

As learned from the specialist in statistics with General Customs Administration, at present China's dependence on oil import has already exceeded one third of its needs and is still on the increase. According to the customs statistics, China's import of crude oil reached 91.12 million tons at a value of US$19.81 billion  and the imported refined oil of 28.24 million tons valued at 5.86 billion US$ in 2003. If cut off the exported crude oil of 8.13 million tons and refined oil of 13.82 million tons in that year, the imported crude oil plus the amount of the refined oil converted into crude oil exceeded 100 million tons already. Along with the shortage in the supply of refined oil at home the export of crude and refined oil from China is on a big decrease year by year. As learned from the General Customs Administration, the first half of the year saw only 3.07 million tons of crude oil and 5.10 million tons of refined oil exported, a respective decrease of 27 and 25.9 percent as against the same period of last year.

Starting from last year China has become a big country of oil import and consumption next only to the United States in the world. The oil import has witnessed a continuous expansion and the import of oil products has become the biggest foreign exchange user in China. In 2003, the balance of crude and refined oil import and export showed US$2.029 billion  in the red. And in the first half of the year the import and export of the crude and refined oil told an unfavorable balance of US$17.3 billion while the unfavorable balance of all other trades was less than US$7.0 billion. This year the annual oil trade is expected to exceed US$30.0 billion in deficit. The drastic increase of imbalance in the oil trade has brought about some bad influence upon the national trade balance.

As the international crude oil price remains at a high stake the annual unit-price of crude and refined oil China imported rose greatly last year as against that of the year before. And the first half of this year saw a continuous rise of the unit-price for the import of crude and refined oil. The price rise for the import crude and refined oil raised the production cost of transportation and petrochemical industry and other related industries. The domestic gasoline price has reached its climax in recent years and this has increased the burden of auto-consumers. Chen Haoran, President of China Minerals and Chemicals Import and Export Association has been engaged in international oil trade for quite a long time. When accepting an interview of the reporter, he said, as a country short of energy resources China sees a serious waste of energy and the wealth created as per-unit energy consumption is far less than that of the developed countries.

Chen Haoran holds, if China is going to build a well-off society it can only be a society of a frugal type. There is no condition for China to follow a production and lifestyle of a high-energy consumption and high spending. It requires China to raise as quick as possible the energy utility with great efforts made to develop the energy-saving products, such as energy-saving construction materials and energy-saving automobiles and so on. At present moment, when autos are entering homes in great number the state has to take some measures for restricting high-energy consumption and autos of big displacement while encouraging the development of autos of economic type with the priority given to the development of rail and public transportation and communication.

(People's Daily August 4, 2004)

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