Evaluating China’s Oil Security and Overseas Oil Investment

Abstract

Oil security is the major concern of China’s energy policy due to the no effective substitute nature of oil and the heavy reliance on internationally imported crude oil. In this paper, a synthesized indicator system was established to analyze China’s oil security from four aspects and Chinese government’s oil security policies were also discussed. From this analysis, we concluded that the main risk in China’s oil security was the gaps between domestic oil supply and demand, and the main means that Chinese government employed on securing oil safety was oil importing diversification, improving transnational pipeline conditions, and enhancing stable domestic oil production. Furthermore, the multiple roles of overseas equity oil production from Chinese National Oil Companies in securing oil safety were discussed and the possible measures and policies on further improving oil safety were also suggested.