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It might be said that this article casts China as a "super capacitor" in that it can store and release massive quantities of oil at will. It also has its own d

by chasil 2mo ago

It might be said that this article casts China as a "super capacitor" in that it can store and release massive quantities of oil at will. It also has its own domestic oil production of 4.3 million barrels per day.

mytailorisrich 2mo ago
Yes and they seem good at this, too. News reports are that they started stockpiling in January at the latest in prevision of a conflict in Iran that did start right at the end of February.
- matthewdgreen 2mo ago
  They started stockpiling in 2024. The estimate is that they had 1.4 billion barrels by the time the Iran war started, and they're down to 1.2 billion now. (Nobody knows for sure, though.) Meanwhile the US has 304 million barrels left in our reserves, but there's a (disputed) operational minimum around 225 million, where draw slows down and the caverns start to suffer damage. (That's about 90 days at current draw rates. Also, this is a loan program, where oil needs to be "repaid" with interest starting in November, so that's going to affect prices too.)
jayd16 2mo ago
Is the crux of this article just that the Chinese oil reserve is 2x the capacity of the US oil reserve? Is there anything more to it than that?
- chasil 2mo ago
  They were also able to drastically cut their own internal demand and external sales/shipments (the article mentions jet fuel to other Asian nations). This was possible because their economic planning is centralized.
- 0xbadcafebee 2mo ago
  4x. The crux is that they can flip a switch to change global oil supply, be highly resistant to embargos, and are no longer subject to OPEC (through Iran & Russian oil traded in Yuan). They can now change global oil prices at will and resist attacks on their energy imports.
- laughing_man 2mo ago
  Which makes sense. The US is a net oil exporter -- in a strategic emergency the US will still have access to oil. China will want to have a much larger buffer, since its economy requires oil from other countries.

by chasil 2mo ago

mytailorisrich 2mo ago

Yes and they seem good at this, too. News reports are that they started stockpiling in January at the latest in prevision of a conflict in Iran that did start right at the end of February.

matthewdgreen 2mo ago
They started stockpiling in 2024. The estimate is that they had 1.4 billion barrels by the time the Iran war started, and they're down to 1.2 billion now. (Nobody knows for sure, though.) Meanwhile the US has 304 million barrels left in our reserves, but there's a (disputed) operational minimum around 225 million, where draw slows down and the caverns start to suffer damage. (That's about 90 days at current draw rates. Also, this is a loan program, where oil needs to be "repaid" with interest starting in November, so that's going to affect prices too.)

jayd16 2mo ago

Is the crux of this article just that the Chinese oil reserve is 2x the capacity of the US oil reserve? Is there anything more to it than that?

chasil 2mo ago
They were also able to drastically cut their own internal demand and external sales/shipments (the article mentions jet fuel to other Asian nations). This was possible because their economic planning is centralized.
0xbadcafebee 2mo ago
4x. The crux is that they can flip a switch to change global oil supply, be highly resistant to embargos, and are no longer subject to OPEC (through Iran & Russian oil traded in Yuan). They can now change global oil prices at will and resist attacks on their energy imports.
laughing_man 2mo ago
Which makes sense. The US is a net oil exporter -- in a strategic emergency the US will still have access to oil. China will want to have a much larger buffer, since its economy requires oil from other countries.