China Needs to Build Massive Tanker Fleet

The fleet should be capable of handling at least 50 percent of China's total oil imports, as stated by shipping industry experts inFriday's Beijing-based Economic Information Daily. Based on this estimation, the oil tanker fleet should be able to handle 75 million tons of the oil imports by the year 2010. The figure would rise to more than 130 million tons by 2020.

Currently, the majority of China's oil tankers are on average six years older than the oil tankers of other countries. The oil tankers are small and, each can carry less than 100,000 tons of oil, compared with the 270,000-ton and 300,000-ton oil tankers commonly used in the international market.

Meanwhile, China's two largest oil importers, the China Petro-Chemical Corp. and the China National Petroleum Corp, do not have their own oil tankers. During the previous several years, the oil imports shipped by China's oil tankers made up only 10 percent of the total, and 90 percent were shipped by leasing foreign oil tankers.

Although the government has worked to build up strategic oil reserves, the work to build a large tanker fleet has been overlooked, according to Yao Ping, deputy general manager of the China Yangtze River Navigation Group.

He cites Japan and Republic of Korea (ROK) as an example, saying Japan has large oil tankers with a total tonnage of 20 million tons, which can ship 80 percent of the oil imported by Japan.
The oil tankers of the ROK can carry a total of 6.6 million tons of oil, accounting for 30 percent of the country's total oil imports.

China mainly imports oil from the Middle East, African, American and Southeast Asian countries, said Li Peirong, Director of the information department of China National Offshore Oil Corp. This means that it will have to depend on sea transportation to import large quantities of oil in the future.

Building China's own oil tanker fleet will also help stabilize ocean oil shipping prices, which rose steadily over the past few years, acknowledged Zhu Ning, General Manager of the Nanjing Yangtze River Oil Shipping Company.

The China Ocean Shipping Companies Group, the China National Offshore Oil Corp, and the China Yangtze River Navigation Group have worked out policies concerning the construction of an oil tanker fleet. Still, the government has no concrete measures to support the development of the sector.

Starting in 1993, China became a net oil importer, and its oil imports have risen steadily. Last year, it imported 123 million tons of oil, while its annual oil consumption stood at 280 million tons.

The International Energy Agency forecast that China will import 150 million tons of oil in the year 2010 and that this number will climb to 250 million tons by 2020.