China’s oil and gas consumption is only increasing, despite the downturn caused by the COVID-19 pandemic. Dr Hooman Peimani looks at the reasons why, and provides an overview of the country’s major pipeline projects.
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s a major exception to the rule, China imported and consumed oil and gas in 2020 at a scale larger than the previous year, despite the COVID-19 pandemic pushing just about all the developed and developing countries into a recession. While these countries, particularly the large economies of Asia (e.g. India, Japan and South Korea), Europe (e.g. UK, France and Italy) and the Americas (e.g. Brazil, Canada and USA), experienced substantial contractions of their economies – lasting up to this date due to the extensive and long-lasting lockdowns to contain the pandemic – China began its economic recovery in 2Q20 through stringent measures. They helped it prevent the expansion of the pandemic from its few affected locations to the entire country, and, as a result, China experienced the revival of its industrial activities and exports while restoring pre-pandemic social activities by the end of 2020. The return to economic and social normalcy in China, except for a few patches of pandemic surge, increased energy consumption in the country to surpass its consumption in the previous year. The expansion of public and private industrial activities, a harsh winter and the record low oil and gas prices boosted their imports as additional factors. Hence, according to China’s General Administration of Customs’ data released in March 2021 (reported by Reuters), the country’s imports of crude oil increased by 7.3% in 2020 compared to its previous year’s imports in spite of the ongoing pandemic “with record arrivals in the second and third quarters”. China’s imports of 542.37 million t of crude oil, equal to average daily imports of 10.85 million bpd, reflected this development. Reported by the same source, its total imports of gas (piped and LNG) amounted to 101.66 million t in 2020, registering an increase of 5.3%
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