Original title: “China is now very short of oil!” 》
Blackgold,industrialbloodfrom the Middle Eastern tycoontrump cardin the commodity worldking.
Advertisement
Petroleum – as the most important energy source for mankind since the 20th century,It profoundly affects the historical process and determines the life and death of the regime.oil supported the rise of the United States and the Soviet Union, blocked the throats of the militaries of Nazi Germany and Japan, made small countries like Brunei and Norway extremely wealthy, and also brought the doom of overthrow to Iraq and Libya.
Oil, fueling the development of cars, trains and airplanes
It also promoted the rise of many countries with oil resources.
For modern countries, is there anySolid oil supplyis a major event concerning the destiny of the country.
Advertisement
Once upon a time, our country was still aoil exporting country. At that time, as large oil fields such as Daqing, Shengli, and Karamay came into operation, China’s crude oil production soon exceeded 100 million tons. Since 1973, our country has even exported crude oil to Japan in exchange for foreign exchange. Until 1993,Exporting country becomes importing countryChina’s oil consumption in the same year was 150 million tons.
Daqing and other cities have therefore become famous “oil cities” in China.
In just 17 years, by 2010, China surpassed the United States and became theThe world’s largest manufacturing country, oil consumption reached 440 million tons. In 2022, oil consumption will reach a staggering 710 million tons, accounting for 15% of global production, second only to the United States with 820 million tons. However, unlike the United States, our oil relies heavily on imports. Imports will account for more than 70% of the 710 million tons in 2022.
The oil we collect ourselves is simply not enough.
And oil is not only the lifeblood of industry, but also the lifeblood of agriculture and logistics, soExpand oil production capacity and ensure oil importshas extremely high strategic priority.
Why is China so short of oil? What is the solution? Today we will talk about China’s oil shortage problem in detail.
My own oil is not enough
my country’s oil shortage dilemma first comes from the huge disparity between reserves, production and consumption.
According to data from the Ministry of Natural Resources (“National Mineral Resources Reserves Statistics Table 2022”), in 2022, China’s oil reserves will be approximately 3.8 billion tons, accounting for only 1% of global reserves.About 1.58%ranked 13th in the world.
Horizontal screenregardless of reserves or production
Middle Eastern countries are all well-deserved oil giants▼
With such small reserves, China remainsThe world’s 6th largest oil producerbut this is still not enough in the face of demand.
▼
OPEC’s December 2022 report shows that China’sConsumptionCrude oil volume is 14.79 million barrels, ranking second in the world.
Equivalent to ourThe 13th largest reserves in the world,AchievedYield of 6thbut to satisfyThe world’s second largest demandnot to mention that our per capita oil consumption is far lower than that of the United States. If we want to catch up per capita, three Saudi Arabias are not enough.
Intuitive comparison▼
The fundamental reason for such a lack of fuel is lack of talent.
Theoretically, as long as there arelarge ancient sedimentary basinit is possible to produce “Oil and gas hydrocarbon generation area”, which contains oil and gas fields. The Gulf of Mexico, Lake Maracaibo, Saudi Ghawar Oil Field and the North Slope Oil Field in Alaska, USA are typical examples.
Oil and natural gas are transformed from organic matter▼
Take the Maracaibo Lake oil region in South America as an example▼
Large sedimentary basins are usually formed in the ocean, while my country’s sedimentary basins are mainly formed by lakes on land.You can imagine the difference in size between the sea and the lake.ResourcesIt’s not an order of magnitude.
Classification of different sedimentary phases ▼
Moreover, during the geological evolution, most of China’s sedimentary basins have been severely damaged, and the geological structurefragmented.
Geological experts once likened the strata of sedimentary basins to a plate. The plates in most oil-producing countries are intact, but my country’s sedimentary basins are like a broken plate that has been stepped on several times.Therefore, if our drilling continues, we may only hit a small part of the target layer, and the outputThe amount of oil and gas must be very smallandShort production cycle.
Only with sedimentary basins can there be oil and gas▼
Another disadvantage is the burial depth of oil. The burial depth of crude oil in my countryGenerally deeper.
For example, oil wells in Xinjiang generally have a drilling depth ofSeven or eight kilometers, it may not be possible to get oil at such a deep level.In countries with good crude oil endowments in the Middle East, Central Asia, and Australia, the depth of oil wells is generallyOne or two kilometersand the output and quality of crude oil are very high.
Horizontal screencome and envy the “oil everywhere” in the Middle East ▼
Saudi Arabia’s national lifeline “Ghawar Oil Field” has a production depth of 2,200 meters and proven reserves of 10.74 billion tons, which is nearly three times that of our country. The cost is even moreAs low as less than $10beating the world.
Oil is abundant and easy to extract. No wonder Saudi Arabia is full of rich people▼
We can get close in the desert10,000 meters deep well(The current deepest drilling depth in China is 9,010 meters). This is of course a reflection of technical strength, but it is also a helpless move due to resource endowment.In terms of the cost and performance-price ratio of crude oil extraction, importing is often more expensive than producing it ourselves.Good dealMuch more.
In fact, China also has oil fields with shallow depth and large output, but they have been exploited for half a century.old oil fieldhas reached the edge of being “squeezed dry”. The comprehensive moisture content of the Daqing Oilfield has reached 95%. It is very difficult to stabilize production. The output is decreasing year by year, so we can only “scrape the bottom of the barrel” as much as possible.
Daqing Oilfield has also been “on duty” for a long time
The large-scale oil fields explored in recent years are generally difficult and costly. For example, the Mahu Oilfield is located in a high-altitude area of 3,000 meters above sea level. It is a tight conglomerate oil field, and the oil is hidden in rock pores that are difficult to see with the naked eye. , the complete development of this oil field belongs toworld class problem.
Mahu depression and surrounding geotectonic location map (a)
Structural unit diagram (b) and cross section diagram (c) ▼
In fact, except for a few countries like Saudi Arabia, the whole world is facing the problem of exhaustion of shallow oil and gas reservoirs, and old oil fields are generally unable to succeed. Although the prediction that the oil will be exhausted has not come true,Drilling is indeed getting deeper and deeper, extending from the intermediate and shallow layers to the deep and ultra-deep layers. In recent years, 60% of the world’s new oil and gas reserves come from deep formations.
Although our mining technology is also improving, we can drill wells nearly 10,000 meters deep, and we have made breakthroughs in unconventional oil and gas resources such as shale oil, shale gas, coalbed methane, and tight limestone gas. However, we are limited by technology and cost. ,wantLarge-scale production increase is still tenDifficulties.
Illustration of different oil and gas well types▼
It can be seen that even if you master the technology of shale oil, oil sands, and deep-sea oil fields, it will be difficult to increase production in the short term, and you will still have to import it.
The Super Buyer’s Dilemma
The international warning line for crude oil dependence on foreign countries is 50%. Our country has exceeded this line for many years.Imports account for a quarter of global importsis a super buyer.
Our oil imports have almost been increasing▼
Since you are a super buyer, you must expand and maintain your own sellers to avoid being stuck by a single source. Fortunately, the world’s crude oil production center is also in Asia, which is relatively close to us.
This cooperative relationship is clearly visible in the lights of the earth at night. From East Asia to Southeast Asia and South Asia, almost all the lights in these monsoon zone countries come fromMassive population, cities, and industryand many of the lights in the “Western Zone of Asia” such as the Middle East, Central Asia, and Siberia come from oil and gas fields. Through oil tankers and pipelines, Asia’s two major economic systems, East and West, are realizing continent-level mutually beneficial cooperation.
Without oil, the lights in the Middle East would be far dimmer than they are now
ChinaThey are a key part of the buyer camp, but not all of them, who also belong to the monsoon zone.Indiaits dependence on foreign crude oil is as high as 85%, so it attaches great importance to its relationship with the Gulf countries. Last year, it even went crazy to buy low-priced Russian crude oil. Its import composition is also quite similar to that of China.
22 years ago, 60% of India’s crude oil imports came from the Middle East▼
In 2022, my country will spend the equivalent of 2.43 trillion yuan on imported crude oil.Saudi ArabiaFirst,RussiaSecond, they all sold us more than 80 million tons.closely followed byIraq, UAE, Oman, Malaysia, Kuwait and Angola.
▼
This import mix is constantly changing. After all, the supply of many major oil-producing countries is not stable, which is closely related to geopolitics. For example, due to international sanctions and political unrest since 2019, we have imported crude oil from Iran and Venezuela. It has been significantly reduced, fortunatelySources of substitutes availableThere are a lot more.
But even with a relatively stable import mix,The rise and fall of international oil prices also have a great impact on economic security, for example, from 2014 to 2016, when international oil prices plummeted, China’s crude oil import costs dropped significantly. In 2019, Saudi oil facilities were suddenly attacked by drones, causing global oil prices to skyrocket.
“Successful attack on Abqaiq
Akin to a massive heart attack for the oil market and global economy” ▼
East Asian countriesImport resources and export finished productsThe model is very sensitive to resource price fluctuations, especially in times of turmoil and frequent conflicts.
Therefore, my country imported a large amount of oil at the end of 2018 when oil prices were low.Expand strategic reservesand has signed an agreement with Russia for more than 30 yearslong-term contractit is very necessary.
Signed in 14 years, the contract period is 30 years, eventually reaching 38 billion cubic meters per year
Starting in 2018, Russia began to supply gas to China through the eastern route of the China-Russia natural gas pipeline.
(Picture: Reuters)▼
Leaving aside relatively distant production areas such as Venezuela and Nigeria, the relatively nearby oil producing areas in western Asia also face the risk of geopolitical instability on a daily basis.maintain peace in this areacan consolidate the continent-level cooperative relationship between the two major economic systems, which is of great significance.
The locals are very worried, fearing that they may accidentally refine oil for the rebels.
Even if the issue of import sources is solved,How luckyIt’s also a problem.
Pipeline transportation is relatively stable, butConstruction is not easyit is relatively easy to build pipelines to Russia and Central Asia, but it is still difficult to directly build pipelines to the Middle East, and the pipelineCapacity is also limited.
Therefore, the issue of shipping is still unavoidable. In the previous two videos on the Strait of Malacca and the Arctic Ocean Route, we talked about this issue in detail.Arctic Ocean routes are not realistic in the short termfrom Pakistan-Gwadar Port, Myanmar-Kyaukpyu PortCutting cornersIt is also difficult to form transport capacity,The Kra Canal is even more unreliable.
Most of the oil imports from East Asian countries pass through the Strait of Malacca▼
soStrait of MalaccaThere is still no way around it. Many people are worried that their necks will get stuck here. In fact, there are many places where their necks can get stuck, such asStrait of Hormuz, not to mention there is such a big India in the middle. This shows the importance of sea power and how difficult it is for China, as a super buyer, to maintain crude oil supply.
As the “throat of the Gulf,” the Strait of Hormuz is often tense
Solution: increase revenue and reduce expenditure
Faced with such poor resource endowments and unstable import situation, what can we do?
The specific measures are nothing more thanOpen sourceandThrottle.
To open source, we must first reduce our over-reliance on specific countries and transform ourMore sources of importsespecially those countries with rich oil resources and underdeveloped economies, such as Angola, Congo (Brazzaville), and Kazakhstan, China participates in oil exploration and production through investment and joint ventures to ensure stable import channels.
Construction sites invested and constructed by Chinese companies in Angola
Ships in the distant port are loaded with oil waiting for export.
At the same time, China’s own oil production capacity can still be tapped. Through advanced exploration and production technology, our oil fields can be “lived as long as possible”.reduceUnnecessary waste. Shale oil, oil sands, and deep-sea oil fields also have great potential. The proportion is not high now, but it will become higher and higher in the future.
Allocate some of your efforts to develop unconventional types of oil
In fact, we still have a lot of room for development.
In terms of savings, it is extremely difficult to reduce overall energy consumption, but diversification of the energy structure is the key and has great potential.
In the past five years, the energy industry represented by wind energy, solar energy, hydro energy, and nuclear energy hasRenewable and clean energy, the proportion increased by 5% (from 20.8% to 25.9%). However, oil only accounts for 3.1% of our power generation structure, while coal accounts for 36.5%.
The use of renewable and clean energy is the general trend▼
After all, we are a country short of oil. We don’t use much oil for power generation, butUsed extensively in transportation and industry, so looking at the current trend of electric vehicles, it is actually using other energy sources to indirectly replace oil. The background of oil shortage is obvious. If consumption cannot be controlled, the gap between output and consumption we mentioned at the beginning will only get wider and wider.
So now society is vigorously promoting new energy vehicles
It’s not unreasonable
The combination of these measures may help China smoothly transition toThe next relatively autonomous energy structureafter all, with the continuous innovation of technology, the status of oil is not eternal. The local tycoons in the Middle East do not want to sit on their hands and are also increasing their efforts to prepare for the post-oil era.
In short, if we want to completely solve our oil shortage problem, we can only wait until oil is no longer so important. It’s not too close, but it’s not too far either,Maybe in my lifetime.
References:
1. “China’s Rising Oil Demand and Its Impact on Global Oil Prices” – Sarah Liao and Milton Russell, The Energy Journal, 2019
2. “China’s Oil Security: Imports and the Changing Geopolitics of Global Oil” – James Henderson and Xunpeng Shi, The Royal Institute of International Affairs, 2018
3. “China’s Crude Oil Imports Just Shy of 11 Million bpd in September” – Reuters, October 2021 https://www.reuters.com/business/energy/chinas-sept-crude-oil-imports-rise-32-yr-1106-mln-bpd-2021-10-13/
4. “China’s Oil Demand Growth to Slow in 2021” – S&P Global Platts, November 2020
https://www.spglobal.com/platts/en/market-insights/latest-news/oil/111220-chinas-oil-demand-growth-to-slow-in-2021#:~:text=China’s%20oil%20demand%20growth%20will,gasoline%20consumption%20this%20year‘s%20gains.
5. “China’s Crude Oil Output Drops 1.3% in 2020” – Xinhua, January 2021 http://www.xinhuanet.com/english/2021-01/18/c_139674745.htm
6. “China’s Growing Oil Demand and Geopolitical Challenges” – Council on Foreign Relations, September 2019
https://www.cfr.org/report/chinas-growing-oil-demand-and-geopolitical-challenges
7. 2023 petroleum industry status and development trend analysis report,https://www.jingyanben.com/ gerenbaogao/ 86316.html?page=1
8. my country’s oil consumption this year is expected to reach 756 million tons, an increase of 5.1%, China Petroleum News Center,http://news.cnpc.com.cn/ system/2023/03/29/030097168.shtml
9. The global maritime crude oil puzzle is here! China remains the world’s largest crude oil importer.
http://www.zgsyb.com/news.html?aid=653321
10. Analysis of current situation of petroleum exploration industry in 2023,
https://www.chinairn.com/hyzx/20230524/170016926.shtml