China’s Oil Supply Security Evaluation And The Solution Strategies

With the rapid development of China’s economy, the demand of oil has been increasing very sharply. However, our oil supply capacity is limited and the demand of oil depends more greatly on import. And in the predictable future, the oil in some industrial field is irreplaceable. Oil also has its unique strategic position in economic development and national defense field. But the reality of China’s oil import situation is concerned, not only foreign dependence is increasing, and import main focus in several few countries. Compared with general merchandise trade, oil trade has its unique properties; including seller’s oligarchs market, irregular price fluctuations, the market structure of monopoly and competition coexist, and the scarcity of resources and unique geopolitical attribute, etc. The particularity of oil products trade decided the problem already beyond economic issue, turning into political economic problems.The definition of oil security is that one oil import country could obtain external oil resources in appropriate price and steady amount at all time in order to meet the need of economic and social development. In the term of import and export, the emphasis on meet its own economic and social needs of development state, the way is for getting external petroleum resources from foreign countries. Therefore, higher ratio of dependence on foreign oil of a country, the oil security problem is more serious. To explore the stability of oil supply, its essence is to study national survive and development needs of the normal oil supply stable security degree from the normal life of oil consumption demand to the national defense military activities of the reliable fuel supply.The necessity of oil supply and the reality of import source tell us that we need to build an assessment system with indicators to objectively evaluate of our oil supply security. Therefore, this paper assesses the country’s oil supply security. In this assessment, I will set up five indexes including the oil import concentration, external dependence, transport capacity, diplomatic relations with oil supplier countries and the stability of oil exporters. In this way, we can comprehensively discuss China’s oil supply security problems with quantitative and qualitative analysis method of combining the five indicators of the measurement. The index value reference a previous study the problem outstanding scholars of data. In China’s imported oil to carry on the basic safety assessment of imported source concentration and external dependence for quantitative analysis conclusion:high concentration, but the trend is decreased; External dependence is extremely high, and the conclusion is rising year by year. As for the transportation capacity, relations with oil exporter countries and stability of the oil exporters, we can not use the specific numbers to analyze it, so it is a better way to use a qualitative analysis way. Through the analysis of transportation channels, the numbers of unfriendly countries that we should pass and the basic strength of China navy, I evaluate the transportation of our country. And on the analysis of the petroleum exporting countries such as degree of stability analysis of the hot spots of the oil game, With the view of political economics point, we will find oil factors in Arab spring, Iran nuclear crisis, the dispute of South China Sea and other international events that may affect the safety of our oil supply. Finally through to the relationship between China and Russia, the central Africa relations and China and other important oil exporting countries in the analysis of the relationship between evaluation and the oil exporters diplomatic relations.Finally several solutions that could alleviate our oil security risk are put forward. First of all, from the military view, we should strengthen the ocean operation capability of our navy. Secondly, in the view of diplomacy, because of the common oil interest, we could cooperate with India etc and form the energy strategic alliance. Thirdly, in the strategic point of view, we should better expand our oil mode of transportation, including Burma Road channels, the pipeline between China and Kazakhstan, cooperation between China and Russia etc. If possible, we can also change our way of grant aid method to "the loan or infrastructure for resources including oil". It is a win-win strategy. At last, we should use some ways to improve economic efficiency, speed up the transformation of the mode of economic development and develop alternative energy. Through these economic methods, we will improve our energy dilemma fundamentally. In the international issue, how to stabilize Iran’s oil supply, to reduce dependence on the strait of Malacca, and get a new scheme of African oil and dissolve the south China sea dispute, this paper gives the countermeasures are, trying to give the new policy suggestions in clear, concrete and timeliness way. The above advices and choices are valuable for our country’s energy policy and the implementation of the strategy in some way.