State-owned China National Petroleum Corporation (CNPC), the biggest oil and gas firm in the country, pledged to make “every effort” to ensure sufficient domestic supply of oil, gas, and fuels amid the Middle East crisis that has slashed supply to key markets, including China.
Dai Houliang, chairman of CNPC, said on Thursday that the company would double down on supply security amid the external shocks, after the company directors met to discuss measures to implement to cushion the supply shock to the Chinese economy.
Last week, CNPC said it ensured natural gas supply during the 2025/2026 winter season by boosting reserves and production at all its major gas fields onshore and offshore China.
“Coordinated and diversified supply sources continued to strengthen the resilience of the natural gas industry chain,” CNPC said last week.
During the winter season, two new underground storage facilities came online at the Tarim and Changqing oilfields, helping CNPC “achieve record highs in both daily maximum and cumulative gas production,” the corporation noted.
During peak LNG demand, CNPC took multiple steps to secure incremental resources and optimize imported pipeline gas, effectively bridging supply gaps, it said.
China faced the start of the Iran war with oil stockpiles amassed over the past year. These have cushioned the initial blow to crude supply when the Strait of Hormuz was closed on February 28.
China has been amassing crude in strategic and commercial reserves for nearly a year. The oil hoarding paid off in the early days of the unpredictable and already highly disruptive war in the Middle East.
The Chinese strategy to build up reserves during a nearly year-long buying spree at relatively low prices is now paying off, as the world’s top crude oil importer has some buffer to power through the severely disrupted oil flows out of the Middle East.
By Tsvetana Paraskova for Oilprice.com
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