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Mon, Mar 07, 2005 - Page 12 News List

China denies it's driving up oil prices


China said yesterday its rapidly growing economy would rely mainly on domestic oil resources to satisfy its energy demands, refuting claims its huge appetite for oil was driving up world prices.

Speaking on the second day of the annual legislative meeting, Foreign Minister Li Zhaoxing (李肇星) said reports blaming China for rising oil prices were "totally ungrounded."

"It is true China's oil imports have increased a little bit over the past one or two years. However, the total of China's oil imports only accounts for around six percent of the world's traded oil," Li told a news conference.

China was not only a big energy consumer but also one of the world's major energy producers and domestic production would play a key role in meeting the country's needs, Li noted.

China's overall crude oil imports last year rose 34.8 percent to 120 million tonnes -- the highest level in the past four years.

Li's comments appeared to contradict ongoing research.

Oil consumption in China is expected to rise sharply by 2010, with more than half of the country's demand being met through imports, Gao Shuxian, a director with the Energy Research Institute under the National Development and Reform Commission, said last month.

China's demand for oil is expected to hit 350 million to 380 million tonnes by 2010, Gao told the Oriental Morning Post.

This means China would need 180 million to 200 million tonnes -- or more than 50 percent of its consumption -- of imported oil in five years if it was to power the factories responsible for last year's economic growth of 9.5 percent.

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