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From the Gulf Times -

China crude oil imports may decline:

CNOOC chairman Fu Chengyu

HONG KONG: China’s oil imports, a driving force behind record crude prices, have “stabilised’’ and may decline within three years on government measures to conserve fuel, the head of the nation’s third-biggest energy company said.

Shipments will stay near 130mn metric tonnes a year, or about 2.6mn bpd, before dropping, helping global prices ease in the “long term,’’ CNOOC Ltd Chairman Fu Chengyu said in a July 18 interview.

International Energy Agency projections, in contrast, suggest China’s imports will rise to 4.4mn bpd in 2009 from 3.3mn this year.

“The policies on energy saving will take three to five years to implement,’’ Fu said in Beijing. “I feel confident that energy imports won’t be as much as we thought before.’’

Falling orders from the world’s fastest-growing major economy, where oil use more than doubled in a decade, would ease pressure on global supplies that pushed prices to a record $78.40 a barrel this month.

Achieving the government’s targets will involve shutting factories that waste energy, setting efficiency limits for cars and increasing fuel prices to curb use.

“They ought to improve the structure of the economy,’’ and curb reliance on energy-intensive industries that consume a lot of oil, said Donovan Huang, senior analyst at credit-rating company Standard & Poor’s in Beijing. “There’s a lot they can do.’’

China’s oil consumption will rise 6.1% to 7mn bpd this year, of which 3.7mn will come from domestic fields, the Paris-based IEA, an adviser to 26 oil-consuming nations, said July 12 in its Monthly Oil Market Report.

By 2009, demand will jump to 8.2mn bpd, of which 3.8mn will be locally produced, the IEA said in its Medium-Term Oil Market Report the same day.

China’s energy consumption is 8.4 metric tonnes of oil equivalent per $10,000 of gross domestic product, 3.4 times the global average, 8 times that of Japan and 4 times the figure in the US, Huang said.

There’s no sign of any slowdown in oil imports yet, as the nation’s economy expanded 10.9% in the first half of the year. Shipments from overseas suppliers rose 16% to 73.3mn tonnes (2.97mn bpd), according to customs figures. China accounted for 28% of the increase in global oil demand between 1995 and 2005, figures in BP Plc’s 2006 Statistical Review of World Energy show.

Chinese oil imports will rise to account for 13% of global oil trade in five years, up from 5% now, Henrik Madsen, chief executive officer at Norwegian energy and shipbuilding service company Det Norske Veritas, said yesterday.

“If you look at the energy mix in China today it’s very much coal, some hydro power, oil and very little natural gas,’’ he said in Beijing.

Oil consumption will rise because of China’s economic growth and as crude replaces coal as fuel in some industries, he said.

China aims to cut the amount of energy used to produce each unit of GDP by 20% in five years, and 4% this year, Premier Wen Jiabao said in March.

The government is seeking to reduce the nation’s reliance on oil imports by promoting power sources such as nuclear, solar and hydropower.

Commenting on the oil market, Fu said “geopolitical issues’’ in regions such as the Middle East may boost prices beyond recent records. Asked whether oil could reach $100, Fu said, “maybe.’’


Rushie
 
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