China Expects 2006 Oil Consumption Up 5.4% To 7% -Reports
DOW JONES NEWSWIRES
February 12, 2006 11:01 p.m.
BEIJING -- China expects its oil supply to be tight this year as oil consumption rises between 5.4% and 7%, state media reported over the weekend, citing the National Development and Reform Commission.
China will likely consume at least roughly 177.24 billion tons of oil products this year, up about 9 million tons from last year, based on the NDRC's forecasts, the Shanghai Securities News said Saturday.
China needs 17 million tons more refining capacity to meet the demand for oil, the paper said, without giving the current capacity.
China's crude oil consumption will near 315 billion tons and require processing capacity to rise by about 15 million tons to 300 billion tons, the paper said. It didn't give comparative figures.
The transport sector, which has entered a period of stable and reasonable growth, will likely account for 75% of China's oil consumption, the official Xinhua News Agency reported Sunday.
China is also working to improve the price-setting mechanism for oil products and may start a fuel tax this year, the paper said, citing an unnamed source at NDRC, China's top economic planning agency.
The NDRC also proposed measures, including developing overseas oil resources, improving China's processing, supply and reserves system and abolishing policy obstacles, to better China's pricing mechanism and energy security system, the paper said.
Some analysts say China's oil consumption grew in 2005, but Xinhua recently said it declined.
An unexpected demand surge from China's power-generating sector in 2004 played havoc with forecasts that were, in some cases, 60% too low, and sent crude oil prices soaring.
The NDRC last week held a meeting in Guangzhou in the southern province of Guangdong.
According to a Xinhua report, one of the issues discussed at the meeting is a new oil products pricing system to be based on international benchmark crude prices. Currently, oil products prices in China are based on a basket of retroactive prices of Singapore, Rotterdam and New York products.
-By Terence Poon; Dow Jones Newswires; 8610 6588 5848; terence.poon@dowjones.com |
