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Chinese oil and gas production hits record high

Oil Rig

Production of natural gas and crude oil in China has hit a new record in the first seven months of this year, according to data reported by the Xinhua news agency.

Over the January to July period, a total of 120 million tons of crude oil was produced, up 3.7% on the previous year, while at 126.7 billion cubic meters, natural gas production rose by 5.4%. Offshore and shale crude production showed the starkest gains, rising by 7.9% and 14.4% respectively. The offshore production of natural gas also rose strongly by 13.6%.

China is one of the world’s biggest oil producers and home to two of the largest oil companies in the world, PetroChina Co. Ltd and China Petroleum & Chemical Corp. While these may be smaller in revenue terms than the Saudi oil giant Aramco, they are larger than the US major ExxonMobil, which also makes products like the Mobil DTE range of hydraulic oil.

The country is also the world’s second biggest consumer of oil, however, making it highly dependent on hydrocarbon imports to sustain its economy. The Beijing government has therefore been keen to intensify efforts to increase its domestic supply of fossil fuels, and these appear to be bearing fruit.

Oil and gas imports in the country have been relatively low this year. While some of this may be due to greater domestic production, much of it will likely be due to the country’s zero-COVID approach to dealing with the COVID-19 pandemic, which has led to falling consumer demand and decreased industrial activity.

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