Natural GasPetroleum

China’s Increasing Demand for Fossil Fuels

Demand Outpacing Production

Chinese demand for oil and gas has vastly outpaced the country’s ability to increase domestic production of fossil fuels. Since 2013, China’s domestic oil production has fallen by 15%, while its demand for oil has risen by over 30% to 13.8 million billion barrels per day (Clemente, 2019). With a population of nearly 1.4 billion and a government that is passionate about increasing economic growth, China’s demand for energy has grown significantly over the past couple of decades. As a result of its population and growing levels of economic development, China’s energy usage accounts for 25% of the world’s total energy consumption (Clemente, 2019).

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The World’s Largest Importer

The increasing demand for imported fossil fuels has created a problematic situation for Chinese leaders. As a country, China has prided itself on self-sufficiency. However, when it comes to its energy needs, China has started to become increasingly reliant on foreign powers to supply its fossil fuels. China is now the world’s largest importer of oil and natural gas. Each day, China imports roughly in 41.24 million tons of crude oil, which is equivalent to about 10.04 million barrels (Lee, 2019). When comparing crude oil imports from September 2019 with September 2018, China imported 10.8% more oil this year than last year (Lee, 2019). September’s imports were increased as a result of China National Petroleum Corporation’s major new refinery that became operational. In addition to traditional oil and gas imports, China recently overtook Japan as the world’s largest importer of liquefied natural gas (LNG), which is a tremendous change from when China was importing virtually no LNG just one decade ago (Clemente, 2019).

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International Investments

To combat rising anxiety about reliance on foreign fossil fuel producers, China has started to become more involved in international oil and gas production projects. Similar to Vladimir Putin’s relationship with the Organization of the Petroleum Exporting Countries (OPEC), Chinese leaders are now becoming highly active in heavily oil- and gas-resourced Africa, Canada, the Middle East, and South America (Clemente, 2019). If China is able to take more control over foreign natural gas reserves, it will be better equipped to implement its anti-pollution campaign, which aims to switch 4.93 million households over to natural gas from dirtier fuels. Between 2017 and 2018, over 10 million Chinese households were switched from coal-fired heating equipment to natural gas-powered systems (Lee, 2019).

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Rising Energy Prices

According the U.S. Energy Information Administration, China holds one of the world’s largest reserves of shale natural gas. Although, much of China’s shale gas is located in areas where it has been cost-prohibitive to extract. If natural gas prices reverse course and become more expensive, China may seek to tap its domestic reserves in an attempt to become more energy independent. However, if oil prices rise significantly, it may dampen China’s ability to support continued economic growth. Earlier this year, Chinese economic data revealed that the country’s retail sales and industrial growth had slowed to its weakest rate in over 17 years (Taplin, 2019). More disturbances in the Middle East, similar to the recent attacks on Saudi Arabia’s oil industry, may increase energy prices and impact overall growth in China.


Within the coming years, Chinese leaders will need to increase their involvement in foreign oil and gas investments to ease concerns about rising imports. With conservative estimates predicting that China’s LNG demand will double by 2020, it will be imperative for China to take more control over their future energy needs to endure global energy shocks and better support economic development initiatives.

Source: Pixabay, JLB1988


Clemente, J. (2019). “China Soaring Past Japan In Liquefied Natural Gas Imports.” Forbes.

Clemente, J. (2019). “China is the World’s Largest Oil & Gas Importer.” Forbes.

Lee, J. (2019). “China September crude oil imports rise on strong seasonal demand.” Reuters.

Taplin, N. (2019). “The Real Loser from the Oil Price Jump Is China.” The Wall Street Journal.

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