ICIS takes a closer look at China’s oil demand and how the country’s position as a leading crude buyer has helped mop up the global oil supply glut. While OECD countries have been struggling to reduce their crude inventories, China has steadily increased its own stocks in a bid to secure its own supply.
Structural reforms in the Chinese oil industry, along with increased competition in the downstream segment, have also whetted the country’s appetite for oil. Independent refiners – or teapots – have become one of the most sought-after markets for international crude sellers, and their allocated import quotas are actively tracked by the global trading community.
In the meantime, China’s gradual shift towards a more consumer-driven economy, combined with the fast-paced development of domestic refining capacity, have prompted a surge in refined products exports, with a potential for sustained oil demand going forward.
In this paper, ICIS assesses the impact of China’s oil consumption growth on the international oil markets, taking stock of the gradual liberalisation of its refining sector and analysing how the country’s domestic oil industry’s developments have tied into the global oil demand and supply balance.