Tuesday, September 13, 2016
Uncertainties Surrounding Chinese Oil Purchases and Global Demand
Akanimo Udofia leads Desicon Engineering, Ltd., and provides a host of technical and infrastructure building solutions to oil sector clients. With a strong industry focus, Akanimo Udofia closely follows trends in the international resources management and extraction spheres.
As reported in Bloomberg, one recent story in the news described China’s buildup of strategic stockpiles of oil and how this affects resource demand worldwide. Stored in commercial tanks on islands within the Yangtze River delta and in underground caverns in the vicinity of the Yellow Sea, these strategic oil purchases represent a significant outlay. Some analysts claim they have been stockpiling 1.1 million barrels per day. The increased demand associated with record purchases from the world’s leading energy consumer is seen as one of the major factors driving oil prices higher.
With the officially released stockpile figure of 191 million crude barrels in mid-2015, estimates point to this having expanded by some 400 million barrels in the year since. The key question for exporters and purchasers of oil futures is whether, once capacity is reached, the global demand for oil will subside again.