China official says oil stockpiling to be a gradual process; no impact on prices
07.30.2006, 11:38 PM
HONG KONG (XFN-ASIA) - China's filling of its first-ever strategic oil stockpile will be a gradual process and should not affect global oil prices in a significant way, the Wall Street Journal quoted a senior Chinese government official as saying.
'The stockpiling effort is likely to persist for tens of years, so it really doesn't matter when China starts filling these reserves,' it quoted Xu Yongsheng, deputy director of the energy bureau under the National Development and Reform Commission, China's top economic-planning body, as saying.
'Also, given the limited volume that China's going to fill, it won't have too much impact on international oil prices,' Xu was quoted as saying in an interview in Vientiane, Laos last week.
China is pushing ahead on a long-held oil-reserve plan aimed at cushioning its rapidly expanding economy from potential supply disruptions or price volatility.
China's stockpiling plan has sparked concerns that any oil buying would lift oil prices to more records.
'Of course we have no intention of starting the filling process now, when oil prices are above 70 dollars a barrel,' Xu said.
Xu also said that if global prices remain firm, China's oil demand is likely to ease in coming years. While demand for transport fuels may grow with rising car sales, industrial consumption may moderate, he said.
rc/
