China's oil and gas import strategy is becoming more focused on security and diversification

More domestic supply with limitation

By 2030, China wants domestic oil and gas output to reach a new base level, about 20 million tonnes of oil equivalent higher than in 2025. Crude output stays roughly flat, above 200 million tonnes a year, with keeping it steady the goal and not pushing it higher. Natural gas does almost all of the extra work, mainly to help balance the power grid. To get there, drillers are moving into harder places to reach such as deep and offshore fields, with eight strategic zones and large offshore projects carrying much of the load.

Crude imports: past the peak, but import dependence remains high

There is no target number for how much crude China should import. Oil demand is expected to peak around 2026, and after that refineries are likely to run a bit less, so imports should ease too. Crude imports could fall by roughly 10% to 20% by 2030 compared with 2025, but China will still depend on imports for around 65% to 75% of the oil it uses. Imports may climb back above 500 million tonnes once shipping through the Strait of Hormuz returns to normal in 2027, but they are unlikely to beat the 2025 high point. The goal is not to buy less oil overall, but to buy it more safely from more places, using more routes and with more say in how the trade works.

Gas imports: growth continues at a slower pace

China still plans to bring in more gas by pipeline and by ship, but both are growing much more slowly than in the last five-year period. LNG import terminals are changing role too, from simply bringing gas in to also storing it for times of high demand. China wants its gas storage to cover more than 13% of a year's use by 2030. Most future LNG has already been booked through long-term deals, leaving less need to buy extra on the open market. By 2030, domestic gas and pipeline imports should cover more than 70% of total demand, with shipped-in LNG mostly filling in the gaps instead of driving growth.

China wants a bigger say in how oil and gas are traded

China is trying to move beyond simply being the world's biggest buyer of oil and gas. It is letting private companies take a bigger part in imports and storage, and import rules may loosen further. Oil that Chinese companies produce overseas is increasingly sold to other buyers around the world, instead of always being shipped back home, and Chinese trading firms are learning to both buy and sell in global markets. China's Shanghai oil exchange is becoming a more important price marker, and more trade is now settled in RMB instead of US dollars. All of this is really about gaining more influence over how oil and gas are priced and traded worldwide, not simply about how much China buys.

Where the opportunities and risks sit

New openings are appearing in trading overseas oil, using China's oil exchange for hedging, offering flexible gas delivery, and helping companies manage sanctions and compliance risk as cross-border trade gets more complicated. But there are risks too. China's big oil companies are handling more of the supply themselves through their own trading arms, leaving smaller traders less room to profit. Long-term contracts and stricter rules add extra cost and paperwork, and oil linked to Iran, Venezuela or Russia carries the risk of sanctions, even when paid for in RMB. Competition for good overseas oil and gas projects is also getting tougher, with international firms and Gulf state companies all chasing the same assets.

Producing more oil and gas at home does not mean China needs imports less, it mostly fills the extra demand created by a slowly peaking market. Crude imports will drop a little over the next five years, and gas imports will keep rising, just more slowly and with more of it going into storage instead of daily use. The bigger change is not in how much China buys, but in how it buys. For instance, spreading out its sources, managing risk more carefully, and gaining more say in how oil and gas are priced and traded around the world.

The above content is the major conclusions and highlights extracted from the "China Oil & Gas Imports Under 15th FYP: How Much Room Is Left as Domestic Supply Grows?" chapter of the latest China Policy Perspective (produced by GL Consulting).

The full chapter includes detailed policy comparison tables, an impact assessment across 16 market segments, and strategic recommendations for investment, trading and partnerships.

For the full report, please contact inquiries@mysteel.com.