On March 23, the China Petroleum Enterprise Association (CPEA) issued China’s Oil and Gas Industry Development Analysis and Outlook Report Blue Book (2018-2019), jointly compiled by the CPEA and the One Belt and One Road Energy Trade and Development Research Center of University of International Business and Economics.

The world’s GDP growth rate in 2018 was 3.7% calculated based on purchasing power parity, and was 3.2% based on the market rate of exchange. Although the rates remained unchanged compared with 2017, the growth driving forces are becoming weak, and therefore the growth is more likely to decelerate in the future. Average price of Brent crude futures reached US$71.69 per barrel in 2018, and that of WTI crude futures was US$64.9 per barrel, up 31% YoY and 27.6% YoY, respectively, propelling the whole oil and gas industry. The US became the world’s largest oil and gas producer in 2018, and saw rapid growth in export of oil and gas. Hence, it will exert more influence on the world’s oil and gas market.

In 2018, refining capacity of Asia represented a downward trend, and profits of European refining markets hit a new low. Operating rates and processing capacity of refineries in the US both increased slightly. In 2019, international oil prices are forecast by the blue book to face great downward pressure, the world’s demand for LNG will increase, and spot prices of LNG will keep rising. In addition, the world’s expansion of refining capacity will decelerate.

China’s crude processing volume and apparent consumption of oil both exceeded 600 million tons, with dependence on imported oil reaching nearly 70%, according to the blue book. China’s overseas oil and gas equity production reached 201 million tons (oil equivalent) in 2018, up 3.7% YoY. In detail, equity crude oil production totaled 160 million tons, and equity natural gas production was 50 billion cubic meters. Further, China’s firms continued to deepen oil and gas cooperation with foreign countries in 2018 as the Belt and Road Initiative wished. At present, projects in countries like Kazakhstan, Brazil and Russia are progressing well. The construction of eastern route of China-Russia natural gas pipeline will soon be finished.