China a big, but not only, contributor to record oil prices: analysts

BEIJING : China’s unquenchable thirst for oil is contributing to sustained high prices, but it is not the main factor in crude’s latest surge toward new records, analysts said Wednesday.

Speculative trading, geopolitics such as unrest in the Middle East and US efforts to fill its oil reserves, as well as the weakness in the US currency, are more important reasons for crude nearing 100 dollars a barrel, they said.


“China’s oil demand is growing but not in a spectacular or explosive fashion,” Alain Sepulchre, an independent French oil analyst, told AFP. “Many people are using China as a pretext.”

China is the world’s second-largest importer of crude, and according to the International Energy Agency, it will overtake the United States as the world’s number one in three years.

But even if China’s need for energy plays an undeniable role in pushing up prices, the role of the West is bigger and speculative trading is much bigger, Chinese analysts argued.

“Demand from Europe and the United States remains large. The United States is also seeking to fill its petroleum reserves,” said Liu Youcheng, an oil analyst at Hongyuan Securities in Beijing.

AFP