China's Quest for Oil
... ago it signed a major contract to produce gas in Australia. The article also mentioned Sinopec and CNPC (China National Petroleum Corp). I also searched and learned about them it turned out that they are vertically integrated firms. From what I read, China’s petroleum industry went through a major restructuring. As part of that process, China reorganized most state-owned oil and gas assets in 1998 into two vertically integrated firms, the China National Petroleum Corporation (CNPC) and the China Petrochemical Corporation (Sinopec). Originally, CNPC had been involved mainly in upstream production and exploration activities, while Sinopec was involved mainly in downstream refining and distribution. The reorganization carried out in 1998 provided for a transfer of assets between the two, transforming them into vertically integrated regional entities, with CNPC in the north and west and Sinopec in the south. Sinopec transferred four northern refineries to CNPC, and CNPC transferred eight southern oil fields to Sinopec. CNPC still has a disproportionate share of oil production capacity, with 2.20 million bbl/d, compared to Sinopec’s 0.75 million bbl/d. Refining capacity remains tilted toward Sinopec, with CNPC at 2.05 million bbl/d and Sinopec at 2.45 million bbl/d. Regarding China and its offshore resources, I found out that last year, China's offshore oil production reached 27 million tons, representing about 15 per cent of total production. China National Offshore Oil Corp and its foreign partners produced most of the oil. This means that China is indeed solving this problem by looking for oil supply from other countries. Recently, the news says that Russia may offer to China National Petroleum Corp. as much as 20 percent of OAO Yuganskneftegaz, which was once OAO Yukos Oil Co.'s biggest unit, giving the Asian state part of a company that extracts 11 percent of Russia's oil. I think this piece of news would somehow lessen the frustration of Chinese leaders on the pipeline project that they were trying to offer Russia and be less threatened of Japan. For me, it is evident that the growing industry of China is the cause of the growing demand of oil by China. This humungous demand of oil by China affects all the countries who are also in need of oil. The surge in consumption has stretched world production capacity and helped drive oil prices to record highs. A surge in Chinese and Indian oil demand, which has helped push world prices to record highs I think that this would be a big problem especially for small countries like the Philippines because there is a rapid increase of oil in the international market but a decrease in supply. This can lead into a shortage and might increase the price of oil more. China was once a large oil producer in the world but now, it is joining other countries in buying oil from other countries in the middle east. It is bad enough that we have to compete with countries like the US, now we also have to compete with China. Nevertheless, I think that the Philippines should follow China’s example. We should invest in studies that will help us determine how to satisfy our demand of oil by investing in exploration and to find out oil reserves in our own country. I also thought that there is a lesson in everything. From this, I think that it is important for a country to always remember that nothing last forever. Like in the case of the oil reserves they have that might deplete in 14 years, there is a need for oil conservation too. We should also be so over dependent on our current reserves, we should also go look for ways to minimize our consumption of oil and as early as now look for alternative ways other than importing oil from other countries. Speaking of other countries, we cannot deny that countries like China have lots of money and be able to buy all the oil they want but they should also not horde all the oil. The article also mentioned Spratlys Islands, which until now is still the subject of disp...