2013 China's Fuel Oil Demand Increases Steadily

2013 China's Fuel Oil Demand Increases Steadily Recently, the "Beijing International Conference on Fuel Oil Industry Development and Trade" took place at the National Convention Center in Beijing. Hosted by the Ministry of Commerce, the Beijing Municipal People’s Government, the China Petroleum and Chemical Industry Federation, and the Beijing Petroleum Exchange, the event featured the release of the "2012 China Fuel Oil Market Report." The report forecasts that China's total fuel oil demand will reach 52 million tons in 2013, showing a steady upward trend. According to the report, in 2012, the country produced 19.29 million tons of fuel oil. The share of production from the three major state-owned oil companies—PetroChina, Sinopec, and CNOOC—rose to 84%, marking a significant increase of 14 percentage points compared to the previous period. This growth was largely driven by a surge in marine fuel oil output. The report also highlights that from 2006 to 2011, both the apparent consumption and production of fuel oil in China declined by 5.3% and 4.4%, respectively. One key factor behind this decline was the weakening demand for refining imported fuel oil. Meanwhile, the marine fuel market experienced robust growth, becoming the primary driver of fuel oil consumption in the country. Li Yongwu, president of the China Petroleum and Chemical Industry Federation, noted that China is now the world’s largest fuel oil consumer and importer. However, he emphasized that the country’s growing reliance on external sources remains a concern. Despite high consumption levels, China has yet to establish a strong fuel oil trading center. The capacity of Chinese enterprises in the global trading system is still limited, and the nation’s status as a major oil-consuming country does not fully reflect its influence in international markets. Liu Shaobin, president of the Beijing Petroleum Exchange, pointed out that China has become a central player in global commodity markets, ranking as the top or second-largest consumer of oil, non-ferrous metals, and iron ore. As a result, China plays a crucial role in shaping global price fluctuations. Yet, many Chinese companies remain at a disadvantage in international trade, often accepting prices set by foreign counterparts without much control over pricing. Liu stressed the need for China to build professional trading and logistics centers in strategic locations to support bulk commodity trading. These centers should offer innovative financial and operational services to strengthen China’s position in the global market. He added that over the next 10 to 20 years, for China to emerge as a major pricing hub for commodities, it must develop not only exchanges but also spot trading and logistics infrastructure. This requires long-term strategic planning and government support to foster the growth of commodity trading markets.

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