A Study on the Scale of China’s Strategic Petroleum Reserve: Flaw and Remedy

　　Abstract :According to China’s Strategic Petroleum Reserve (SPR) Plan, China’s SPR in 2020 will equate to 90 days net import of oil by the country. This capacity will be built up across three phases. The first phase, which has already completed, calls for a reserve of 13.68 million tons of oil. The second and third phases each plans to build up a capacity of 28 million tons of oil, making the total 69.68 million tons, or 513 million barrels. However, as this article shows, the 2020 target is far too conservative, considering China’s projected economic growth in the next decade and its corresponding rise in energy demands. Even when taking into account the growth of China’s domestic oil production, China will still need to import 0.94 million tons (6.92 million barrels) of oil by 2015; by 2020, this figure will rise to 1.35 million tons (9.95 million barrels). These figures translate to reserves of 84.76 million tons (623 million barrels) and 122 million tons (895 million barrels) in 2015 and 2020, respectively. The authors propose revising the 2020 figure in accordance to these projections so as to meet China’s strategic plans, and go on to show that a timetable for the proposed figure is theoretically achievable and economically viable.