China's oil consumption to exceed 350 million tons

According to an expert with China's National Development and Reform Commission (NDRC), the country's oil consumption is expected to exceed 350 million tons in 2007.

Jiang Xinmin, an expert with the Energy Institute under NDRC, predicted that this year China's oil consumption will up 2.9% from the 340 million tons in 2006.

High oil prices have impacted the nation's energy budget, said the expert, adding that the country might replace oil with gas in some regions.

Jiang also noted the fact that domestic oil production increases by 1.5% to 2% per year, whereas crude oil consumption had jumped by about 8% a year since 2000, which compels China to import more.

Just ten years ago, the country was an oil exporter. But in 2006, nearly 50% of China's oil consumption came from foreign suppliers.

International oil prices have risen from US$25 per barrel in 2003 to US$70 now. "The unrest in the Middle East adds to oil price uncertainties in the global markets," said Jiang.

In 2006, China imported 139 million tons of crude oil, up 17% from 2005. Imports accounted for 47% of the country's total consumption. Analysts have warned the government of the potential risk that China may need to import more than 50% of its petroleum needs in a year or two.