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China's demand for oil pressures global markets: S & P
10/14/2005
SHANGHAI, Oct 13 (AFP) - Years of economic heated growth in China has strained the country's oil resources and triggered a hunt overseas for fresh supply which is expected to continue pressuring global oil markets for decades to come, ratings agency Standard and Poors said Thursday.
China's race for resources is also fraying international tempers and is one main driver of soaring oil prices, which for months now have hovered well above 60 dollars a barrel, the ratings agency said in a report.
"This expansion strategy is already helping rattle the global oil markets and straining international relations," it said.
"This is one of the reasons for higher energy prices, which are putting pressure on those companies that use large amounts of energy."
Crude futures notched up historic records in August, striking 70.85 dollars in New York and 68.89 dollars in London, after hurricane Katrina tore through the US Gulf Coast.
"Helping China to satiate its energy needs without sending the global markets into shock will require international cooperation, based on recognition of mutual interest," added analyst John Bailey.
As the world's second-largest oil consumer after the United States, China consumed 314 million tonnes of oil last year, of which it imported 122.7 million tonnes.
China produced some 175 million tonnes of crude oil in 2004 and domestic production is expected to reach 180 million tonnes this year.
By 2030 the International Energy Agency predicts that China's imports will soar to 10 million barrels per day, accounting for 80 per cent of its energy demand.
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