High oil price: China also wants to tap into reserves

Status: 11/22/2021 2:43 p.m.

In China, too, the government is planning to tap into the country’s oil reserves. The reason for this is the rise in prices. Not much is known about the state oil reserves of the People’s Republic.

By Steffen Wurzel, ARD-Studio Shanghai

2020 was an extraordinary year – also on the international oil markets. When the coronavirus spread from China across all borders in spring 2020, it caused uncertainty in the financial and raw material markets. Share prices fell, as did oil prices. China’s state and party leadership took advantage of this. They bought oil in large quantities at low prices. Not all of it has been used up. Back then, in the spring of last year, huge amounts of crude oil flowed into the state oil storage tanks.

Size of supplies unclear

According to an analysis by the Canadian investment bank RBC Capital Markets, the People’s Republic bought and bunkered so much oil in the spring of 2020 that it could have covered around two years of the country’s entire oil consumption. According to analysts at the US financial services company, when oil became more expensive again in the fall a year ago, China’s leadership had it Bloomberg also sold oil again and thus made good profits. Since then, China’s crude oil reserves are said to have plummeted again.

However, the exact details are unclear. Because while other states publish monthly figures on their oil stocks, China’s leadership treats the issue as a state secret. Chinese authorities have not reported anything about the country’s oil stocks since 2019.

Remarkable willingness to cooperate

It is therefore remarkable that China’s state and party leadership was now even ready to talk about tapping into the state’s oil reserves. The move is intended to depress prices and thus lower inflation. A spokeswoman for the relevant Chinese authority told the news agency in the middle of last week Reutersthat they are working on releasing crude oil reserves. China is also negotiating with other states, including the governments in India, Japan, South Korea and the USA.

China wants to tap into oil reserves

Steffen Wurzel, ARD Shanghai, 22.11.2021 · 13:24

Reference-www.tagesschau.de

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