Peak Oil is You

Donate Bitcoins ;-) or Paypal :-)

Page added on June 10, 2018

Bookmark and Share

The gift and the curse of China’s energy demand

The gift and the curse of China’s energy demand thumbnail

Last year, China became the world’s largest and second-largest importer of crude oil and liquefied natural gas (LNG), underscoring that the driver of global growth and energy demand has moved from west to east.

While energy consumption in the U.S. and Europe has never recovered to the levels seen before the global financial crisis, China’s demand has surged by a third in the decade since.

Although this is reflective of the dynamism of China’s economy, it’s also the country’s Achilles heel. Demand growth might have slowed to single digit figures, but energy imports have grown on average by over 10 percent every year over the last decade with China increasingly reliant on imports of not just oil and natural gas but even coal to meet the country’s ever-increasing energy needs.

Part of the reason China’s energy consumption is so large is due to the size of China’s industrial sector. In developed economies, industry uses slightly over one-fifth of all energy. In China, it consumes over a half.

The source of this is primarily coal, not only in the form of coal-fired electricity generation but also direct burning by heavy industry like ceramics and steel.

China’s push to be a global leader in electric vehicles and renewables might have grabbed the headlines, but one of the largest factors in constraining the seemingly inexorable rise of China’s energy demand will be the move away from an economy built on industry and manufacturing.

In the future, consumption and services, which need less energy for every unit of economic growth, will be the drivers of rising productivity required for long-term economic success.

This is not to say that industry will play no role in China’s future. It will. It’s just that it will be less energy intensive. Everyone is aware of China’s ambitions to become a global leader in advanced information technology, robotics and electric vehicles as part of its “Made in China 2025” industrial masterplan.

Less discussed is the upgrading of basic manufacturing, which aims to reduce industrial energy intensity by a third over the decade 2015–2025 so that basic manufacturing will be efficient as that of advanced economies.

Even with a more energy-efficient industry and innovation and digitization as the new drivers of growth, energy demand will still expand with the government aiming for 2030 energy consumption to be no more than a third higher than it is today.

At the same time, policies tackling the environment and China’s chronic air pollution will see the share of cleaner fuels like natural gas and renewables rise from just over 20 percent today to around 35 percent of total consumption by 2030.

In the short term, the focus on the environment has offered plenty of opportunities for LNG exporters. Imports into China are up 60% on 2017 and the average spot price of LNG sold to Asia as represented by Platts JKM is up a third on 2017. But this may not last forever.

A new natural gas pipeline from Russia scheduled to come online in 2020 and another planned for a few years later may make life a lot more competitive for LNG into China in the next decade.

Even with the push toward the use of gas and renewables, coal will still dominate China’s energy landscape with analysis by S&P Global Platts Analytics suggesting that coal’s share of China’s total energy consumption will fall from around 60 percent last year to around 44 percent of the total by 2030.

Coal consumption actually rose last year on the back of strong industrial production and it may be well into the middle of the next decade before we start to see any significant reduction in total coal consumption. However government leadership means that this coal will be burnt more efficiently.

Policies mandating the upgrading of existing coal-fired power plants and use of advanced coal-power-generation technology in new plants will mean that by 2020 coal-fired electricity generation will be more efficient and produce fewer emissions.

It’s easy to forget that as recently as 2014, China was the world’s fourth-largest crude oil producer behind Saudi Arabia, Russia and the U.S. But with domestic production in decline, China is more and more reliant on overseas crude, around 70 percent of which was imported last year.

Unlike other fuels, there are few substitutes for oil, and while the development of electric vehicles is a strategic priority for China’s leadership, this is in many ways driven as much by a desire to capture a position of global leadership in new technologies as it is by energy security.

With strong policy support, it may be possible for electricity to displace oil as the fuel in much of China’s road transport, but this will take decades not years, and there is still no technology to substitute for oil in the aviation and petrochemical sectors, which will be driving oil demand as China moves to that consumption led economy.

the hill

40 Comments on "The gift and the curse of China’s energy demand"

  1. Davy on Sun, 10th Jun 2018 6:59 am 

    If there is an energy crisis the world is screwed including the US but especially China and Asia. These huge population regions are being supported and enabled by fossil fuels. Fossil fuels will end eventually from both depletion and for economic reasons. It is ahead and so is Asia’s end. This inconvenient reality is broadly denied here by those with the pro-Asia and Eurasian extremist agendas.

  2. twocats on Sun, 10th Jun 2018 7:39 am 

    “Although this is reflective of the dynamism of China’s economy, it’s also the country’s Achilles heel.”

    Let’s play the JuanP game. Achilles heel is supposed to be a mortal weakness. But then for the next three paragraphs the author talks about Master Plans, EVs, and transition to consumer-based economy. US propaganda through and through.

    But on a relevant and interesting note – it is interesting that Peak Oil has become this hot-potato that countries are passing around. Europe weened first, then the US, now China. No one wants to be the Goose when the PO reality finally settles in.

    Of course, if all your consumer imports are fossil fuel related (“consumed” by the country that produced those exports) then you are an oil-user-by-proxy. US uses most FF per capita of anyone in the world and we probably also have the most imbedded energy use of anyone in the world.

  3. Davy on Sun, 10th Jun 2018 8:51 am 

    “US uses most FF per capita of anyone in the world”

    That’s not true and if you deduct the ff that are reexported through crude, gas, and ff products that goes down further. Add to this our huge food export production. Further rightly are wrongly playing world policeman to nations not willing to step up to their responsibilities and hostile aggressors. The US is one of the highest per capita. We spend too much on the military that eats up FF.

    Please stop this apologist mentality of trying to pander to the extremist anti-American rabble. The US is bad but nowhere near as bad as the home grown and foreign anti-American extremist paint the US out to be. WTF! Some call the US evil. Lol like there are angelic countries out there? Another WTF BS.

  4. Sissyfuss on Sun, 10th Jun 2018 9:19 am 

    China venerates wonderful, clean coal and the Keeling Curve confirms it.

  5. twocats on Sun, 10th Jun 2018 9:47 am 

    qatar and brunei don’t count. and if exports matter, then Canada would be below us as well. and China exports a lot to US – so put those on our bill as well. Its not anti-American to state US uses too much FF per capita. What website do you think this is? It’s about FF use and its depletion.

    the swerve into “policeman to nations” is just weird and gibberish.

  6. JuanP on Sun, 10th Jun 2018 10:15 am 

    This link is to an article that provides a very interesting analysis of the China-Pakistan Economic Corridor (CPEC). The CPEC is a major component of the multi trillion dollar Belt and Road Initiative. The article is unusually balanced and very well informed and I mostly agree with it. It’s definitely worth reading.

  7. LetStupidPeopleDie on Sun, 10th Jun 2018 10:22 am 

    Said what you want, China manufactures almost everything now. Either you bring back manufacturing in Western countries or you supply China with energy because China is a vital link in the international supply chain. They are the manufacturing link in the supply chain.

    On a international level, you can stop energy delivery to Canada and not much will happen to the supply chain, Canada does not manufacture much and their energy consumption per cap;ital is among the top..

  8. Davy on Sun, 10th Jun 2018 10:35 am 

    “Its not anti-American to state US uses too much FF per capita.”
    UH, you didn’t say that you said it uses the most in a naked way without claifications. You point was Americans are dirty energy sluts.

    It’s anti-American to point fingers at the US as the worst with no other references and no explanation. I think these examples are pretty much to the point:
    “US uses most FF per capita of anyone in the world” then saying “qatar and brunei don’t count”
    How about others that are very close? No mention of those people. You did not acknowledge the US and its export of energy but pandered to the Sinophiles who are always diminishing China’s energy consumption because, you know, we make them produce things we want bullshit. The US is in the top of export nations so we are using energy that gets embedded in products going to others. Two-cats you like being an anti-American apologist. I guess you want to be part of the group here and to do this you need to talk anti-American.

  9. Davy on Sun, 10th Jun 2018 10:46 am 

    “China manufactures almost everything now.”

    This is another naked unsupported statement. They are involved in most manufacturing. They are the top manufacturer. They don’t manufacture almost everything. Show me your references for that exaggeration.

  10. MASTERMIND on Sun, 10th Jun 2018 11:33 am 

    Trump spent the G-7 meeting railing against high tariffs that do not exist..

    Average tariff rates charged by G-7 nations:

    USA: 1.6%
    EU: 1.6%
    UK: 1.6%
    Italy: 1.6%
    Germany: 1.6%
    France: 1.6%
    Japan: 1.4%
    Canada: 0.8%

    Source: World Bank

    The scaremongering never ends, the immigrants, the muslims, the liberals, the tariffs etc..People on the right are dumb as bricks and scared of nearly everything on earth..

  11. twocats on Sun, 10th Jun 2018 1:58 pm 

    Nice article find JuanP. I’m only about half way through but that is some intense analysis. My mushed American brain can only take so much learning though so I’ll have to take a break.

  12. Boat on Sun, 10th Jun 2018 2:47 pm 

    There is no fear with the US absorbing a 556 billion trade inbalance with the world. But there is this 556 trade In balance. So now fair minded countries will work hard to be fair and give up that advantage without a fight. Lol Actually those peckerheads can whine uite loudly.

  13. Makati1 on Sun, 10th Jun 2018 4:56 pm 

    “Of course, if all your consumer imports are fossil fuel related (“consumed” by the country that produced those exports) then you are an oil-user-by-proxy. US uses most FF per capita of anyone in the world and we probably also have the most embedded energy use of anyone in the world.”

    BINGO! Well said twocats! Well said!

    You pointed out the obvious to anyone outside the Us gulag, but it is not obvious to the average dumbed down American. Every piece of clothing, every electronic gadget, every cup of coffee, everything the Us imports has embedded energy. The truth be told: “The United States, with less than 5 % of the global population, uses about a quarter of the world’s fossil fuel resources—burning up nearly 25 % of the coal, 26 % of the oil, and 27 % of the world’s natural gas.”

    THAT is why I say that the US is going to suffer the most when the SHTF and the system feeding the Us collapse’. Bring it on!

  14. MASTERMIND on Sun, 10th Jun 2018 5:12 pm 

    Our nation is permanently fractured

  15. Davy on Sun, 10th Jun 2018 5:19 pm 

    3rd world love per capita. He uses it all the time to cover his ass. This link is disgusting if you care about the earth:
    “China Consumes Mind-Boggling Amounts of Raw Materials”

  16. MASTERMIND on Sun, 10th Jun 2018 5:27 pm 

    In America anyone can become president..That’s the problem..

    -George Carlin

  17. Makati1 on Sun, 10th Jun 2018 5:29 pm 

    Per capita is the best way to compare stats. That is why it is used universally in statistics referring top humans.

    That you do not like what they show is too bad, Davy. They point out reality. Not propaganda.

  18. Makati1 on Sun, 10th Jun 2018 5:33 pm 

    ““China Consumes Mind-Boggling Amounts of Raw Materials” AND… ships most of them to the Us and other countries. Fact: China is the world’s manufacturer as America is soon going to painfully realize.

    BTW Davy, where is your referenced rebuttal to my post about the amount of resources the Us consumes? AW! You couldn’t find any? Too bad! Again, reality is a bitch and you are it’s target.

  19. MASTERMIND on Sun, 10th Jun 2018 5:34 pm 


    China’s debt is unsustainable, and they have peaked in oil and coal..And there is economy is scheduled to double in size in the next ten years..never going to happen..for physical reasons of course..

  20. Makati1 on Sun, 10th Jun 2018 5:44 pm 

    MM, the most indebted country in the world is the Us. Only the petrodollar is preventing it from collapse and Russia, China, Iran, etc. are working to make that happen soon.

    China has gold to back up its currency. The Us has not proven that it has ANY gold for ay least 40 years. I suspect that Fort Knox is empty. The rest of the world is beginning to think so too.

    “Bottom line: If you believe the government routinely lies or covers up its actions, we can’t simply laugh off the idea that there’s no gold in Fort Knox. Until an audit is done, the facts provide more questions than answers.

    And while I don’t believe Fort Knox is completely devoid of gold, it’s certainly possible that our gold reserves are lower than reported and/or not wholly owned by the U.S. government.”

    The Us economy is a house of cards and they are shaking. Slip slidin’…

  21. Duncan Idaho on Sun, 10th Jun 2018 5:48 pm 

    China’s debt is unsustainable, and they have peaked in oil and coal.

    China is a ecological nightmare– the last time my brother was there on business, the sky was green the whole time.
    It is not survivable.

  22. MASTERMIND on Sun, 10th Jun 2018 5:52 pm 


    I emailed Professor Douglas B Reynolds PhD, Oil and Energy Economics, University of Alaska.

    And I asked him if our upcoming oil shortage will cause a global economic collapse?

    He replied;

    “Yes, it will be like that, but may be worse with other extenuating circumstances such as war or the decline of international trade. Hyperinflation as happened in the Soviet and Post Soviet economy is a certainty.”

    That’s it..there will be no leveling just a great total global collapse..

  23. Davy on Sun, 10th Jun 2018 6:05 pm 

    Per capita what 3rd world? Maybe in the world of 3rd world per capita is best. In the normal world it is just one comparison.

  24. Davy on Sun, 10th Jun 2018 6:09 pm 

    “BTW Davy, where is your referenced rebuttal to my post about the amount of resources the Us consumes?”

    3rd world where did I say the US didn’t consume resources? I didn’t say that stupid so no rebuttals needed. It is obvious and unlike you I achnowledge reality.

  25. Boat on Sun, 10th Jun 2018 6:17 pm 


    Why would the world collaspe in countries that are energy independent? Those with energy will be presented further opportunity. Frills like health care, scocial programs and militaries will take a hit but poor energy countries will just die off till their sustainable. Overshoot isn’t the end for those with money/btu’s.

  26. Cloggie on Sun, 10th Jun 2018 6:20 pm 

    “Our nation is permanently fractured”

    Millimind is bringing grist to my mill.

    He loves to phantasize about nuclear first strikes against “renegade province of the US empire”, Russia. But when he calms down, he has to admit to himself that the great Zionist project of the 20th century is coming to a shrieking halt and that Eurasian predators merely have to pick up the “fractured pieces” from a dying Anglosphere.

  27. Cloggie on Sun, 10th Jun 2018 6:25 pm 

    “Why would the world collaspe in countries that are energy independent?”

    I bet you think thay the US is an “energy independent country”. It isn’t.

  28. Makati1 on Sun, 10th Jun 2018 6:37 pm 

    Boat believes everything the Us propaganda mill spews out about America’s exceptionalism. To look at the truth would shatter his world. It is going to be shattered anyway, and soon.

    The Us consumes about 25% of the world’s oil. That is in the form of not only oil production in the Us, Mexico and Canada, but also the oil embedded in the $trillion plus of imports. The Us is more import dependent than most any other countries in the world for its necessities.

  29. MASTERMIND on Sun, 10th Jun 2018 6:39 pm 


    Because the world is so interconnected through globalism now..That Iphone you are using isn’t made in California…

  30. MASTERMIND on Sun, 10th Jun 2018 6:41 pm 

    This is what is likely to happen..the oil will run short and the stock market will have a shit fit and collapse..the grids will go down..and you will be all on your own..You against the world around you in a survival of the fittest last will be like going back in time 200 years..

  31. onlooker on Sun, 10th Jun 2018 7:00 pm 

    The entire world economic system is buckling under its own weight. This interconnected global behemoth reliant on massive amounts of energy, corrupt to the core and existing now as a giant Debt scam is just about run its course.

  32. Boat on Sun, 10th Jun 2018 8:09 pm 


    Your link is old news like the crap mm feeds us. N America is energy independent. The US only needs 2.7 mbpd and Canada feeds the US 4 mbpd. Guess what, Canada has no other outlet. We got oil, Nat gas, coal and the rest covered. Unlike the EU we got all the energy we need. We have no need to kiss Putins or Irans ass for fuel. Sucks to be you. Lol

  33. Boat on Sun, 10th Jun 2018 8:15 pm 

    Just think if the US quits policing the middle east. Your ass would be walking quick along with China, Japan etc. Trump has all y’all by the balls. Lol

    Rise of the right, lol, rise to plant a bigger garden is more like it.

  34. Anonymouse1 on Sun, 10th Jun 2018 8:26 pm 

    Shut up retard, seriously. Go watch some (more) 700 club, or watch your Pat Robertson DVD collection. Find something more useless to do than proving over and over again, how jaw-droppingly stupid you truly are.

  35. MASTERMIND on Sun, 10th Jun 2018 10:01 pm 

    Peak demand is here..It’s really happening people! Ev’s are taking over!

  36. MASTERMIND on Sun, 10th Jun 2018 10:07 pm 

    EU official mocks Trump with viral Merkel photo: ‘Just tell us what Vladimir has on you’

  37. MASTERMIND on Sun, 10th Jun 2018 10:15 pm 

    CNN host Bourdain jokes about poisoning Trump

  38. Cloggie on Mon, 11th Jun 2018 12:51 am 

    “EU official mocks Trump with viral Merkel photo: ‘Just tell us what Vladimir has on you’”

    Merkel is not “staringg down” Trump. Instead Trump is calmly in a conversation with Macron.

    That “EU official” is non-other than the Belgian Guy Verhofstadt, a nasty globalist piece of work if there ever was one. An iltimate water carrier of the US COMIntern.

  39. Cloggie on Mon, 11th Jun 2018 12:56 am 

    Who is Guy Verhofstadt?

    Look who is there at [10:52]: Euro-gnome Guy Verhofstadt, water carrying for the dangerous NGO (read: US version of the Soviet Comintern) ‘Freedom House‘, run by neocohn David Kramer. Aim: destruction of Putin-Russia (via regime destabilization), who dares to resist the NWO, the American version of communism, with communism defined in the broadest sense: the entire world united under a single government, run by… ehm … neocons, yeah, that’s it: neocons. Soviet-Russia tried to unify the world with economic egalitarianism (“you, you… filthy class enemy!”). The US tries to do the same with racial egalitarianism (“you, you… filthy racist!”). Verhofstadt is lying through his teeth when he claims that Putin was not elected democratically. Vladimir Putin has approval ratings the European political class, including this Flemish fool, can only dream of. Indeed, these multicultural traitors of their own populations should not expect a benevolent treatment by the revolting population of Europe once a ‘European Spring’ of sorts will begin. People like Verhofstadt are the main reason for the decreasing popularity of the European project. The first speaker is congressman Jim McGovern Massachusetts, a third rate jockey for a real member of tptb, Tom Lantos. Jim McGovern was co-responsible for the anti-Russian Magnitsky Act, yet another calculated US provocation towards the intended confrontation with Russia.

    Verhofstadt playing the revolutionary at Maidan square. Putin wants a Russian Russia. Can’t have that in the NWO.

    The career politician without a vision of his own. The politician who knows on which side his bread is buttered. Pure NWO material. Total lapdog of the Americans. The anti-European. The politician who would adopt North-Korea into the EU, so he can send them a tax form as well. The quint-essential liberal and sell-out of his people. Failed communist.

    Millimind loves these kind of people.

  40. Anonymouse1 on Mon, 11th Jun 2018 4:17 pm 

    You love those kind of people too Cloggraham, they are 100% your ‘kind’ after all, no matter how much time your fake persona spends insisting (and pretending) otherwise. A fun game for you im sure, leading retards like the exceptionlturd, boatretard etc around by the nose all day long.

    Odd how a self-described, and alleged, ‘dutch seculairst’ spends so much time on a fairly obscure ENGLISH language site. Whats the problem?, you keeping getting banned from registered ‘dutch’ sites or something?

Leave a Reply

Your email address will not be published. Required fields are marked *