Review on the petroleum market in China: history, challenges and prospects

The petroleum industry plays an essential role in driving China’s economic development. In the past few decades, several reforms in the petroleum industry have been implemented; however, there are still some issues that have not been resolved. Moreover, with the new-normal economy, the transition to green energy and international trade disputes, the petroleum market is also facing emerging challenges. Therefore, the purpose of the present study is to review the historical development of China’s petroleum market, identify the current challenges and propose corresponding countermeasures for future prospects. As a conclusion, five main challenges are highlighted totally, namely lack of marketization, excess oil refining capacity, high external dependency, environment pollution and unstable international trading relationship. To address these challenges, it is encouraged to deepen petroleum market reform, accelerate the elimination of inefficient refining capacity, diversify oil supply sources, as well as improve domestic petroleum enterprises’ ability to resist price risks.

Nigeria's Petroleum Sector and GDP - The Missing Oil Refining Link

Nigeria is generally referred to as an ‘oil economy’ because of the country’s large amount of oil reserves Yet, the petroleum sector in Nigeria currently contributes less than 10 percent of the country’s gross domestic product (GDP). In comparison, some Gulf states petroleum sector’s GDP contribution is usually more than 30 percent. A fundamental reappraisal of the Nigeria’s petroleum sector’s relationship with the economy is required. This paper posits that the missing link between the petroleum sector and Nigeria’s GDP growth is the country’s petroleum refining capacity. Capacity utilization of Nigeria’s refineries dropped to 14 percent in 2014 against a global average refining capacity utilization of 90 percent. The constraints of crude oil supply to Nigeria’s refineries are revealed as well as policy interventions by the Federal Government of Nigeria aimed to increase in-country oil refining capacity. Refining capacity is suggested as an antidote to Nigeria’s so-called ‘resource curse’.

Nigeria's Niger Delta violence will be hard to resolve

Significance It is hobbling the critical hydrocarbon sector through high-profile attacks on oil installations. Impacts The government's decision to let the naira currency float freely against the dollar will improve relations with investors and donors. However, the naira's sharp depreciation will likely drive up inflation, exacerbating grievances over living costs. Progress on displacing Boko Haram from its main areas of operation will continue; the group may retaliate with bombings in urban areas. New oil infrastructure deals with China earlier with this week will improve Nigeria's refining capacity, but only in long term.

Nigeria eyes refinery push

Subject Nigeria's fuel subsidy outlook. Significance The drop in global oil prices should create the space to eliminate fuel subsidy payments, but the naira's 25% depreciation means that complete deregulation could lead to rising fuel prices for users. President Muhammadu Buhari has therefore focused instead on an ambitious strategy to boost domestic refining capacity to loosen fuel importers' grip on the downstream sector. Impacts Concerted subsidy reform will be difficult so long as there is uncertainty over the naira's stability. Headway on corruption could help to create the political space to remove subsidies in the future. Buhari's confirmation that he plans to head the oil ministry could help to create that.