Asia

Xi signals continued role for fossil fuels to meet power demands

SHANDONG (BLOOMBERG) – President Xi Jinping told oil workers that China must secure its own energy supply, signalling a continued role for fossil fuels in the nation’s efforts to meet power demands.

Mr Xi made the remarks during a visit on Thursday (Oct 21) to the Shengli oilfield in the eastern province of Shandong, according to the People’s Daily newspaper.

The oilfield is the largest operated by China Petroleum & Chemical, or Sinopec.

“Oil energy construction is very significant to our country,” Mr Xi said.

“As a major manufacturing power, China has to secure its energy supply in its own hands.”

Mr Xi’s comments suggest that fossil fuels – and crude in particular – remain central to China’s efforts to ensure energy security, irrespective of the government’s parallel commitment to capping greenhouse gas emissions.

The Chinese president similarly inspected a coal-to-chemicals plant while touring Shaanxi province last month.

Sinopec has also positioned itself as a national leader in developing hydrogen as a clean energy source.

The nation’s three biggest oil companies report third quarter earnings next week, where the usual attention to their spending plans will take on particular significance in light of the energy crisis that has wracked the world’s No. 2 economy.

Chinese leaders have been seeking to minimise disruptions as the energy crunch roils the world’s most important manufacturing hubs. Last week, Premier Li Keqiang vowed to ensure power supplies to factories, after saying a path to a greener economy needs to be underpinned by a stable supply of energy.

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