China would join coordinated global efforts to release oil reserves "depending on its own requirements," the foreign ministry said on Wednesday, adding that Beijing is in contact with other countries that have already detailed their measures to calm global market turmoil.
After President Xi Jinping and his US counterpart Joe Biden discussed the subject last week, the US, Britain, Japan, South Korea, and India have already committed to releasing state reserves in a bid to lower high energy costs.
China to release emergency oil reserve
During the virtual conversation between Xi and Biden, the US pushed China to transfer oil stockpiles to assist calm surging world crude oil prices. In response to emailed queries concerning China's involvement in the coordinated effort to unlock oil reserves, the National Energy Administration of China did not react.
"The market has been speculating that China may soon disclose its second batch of oil reserves," said Feng Xu, a crude oil analyst with Sublime China Information, SCMP reported. China's 7.38 million barrels of reserves may be released from its Zhoushan base in the eastern province of Zhejiang, according to Feng, bringing the total to the same level as the amount released in September.
According to Kang Wu, head of global demand and Asia analytics at S&P Global Platts, China's government-managed price system ensures local prices closely track global oil market fluctuations.
China would release crude oil from its reserves in accordance with its real needs, according to Chinese Foreign Ministry spokesperson Zhao Lijian, who also stated that the government is in close contact with oil-producing and oil-consuming countries in order to maintain a stable oil market.
US President Joe Biden announced on Tuesday that he had ordered the release of 50 million barrels of oil from the United States' strategic reserves in coordination with China and other Asian nations in an effort to bring down oil prices after OPEC+ producers repeatedly ignored calls for increased crude output, as per CGTN.
US joined by other countries to enhance oil supplies
Zhao said at a daily news conference that China will also take other necessary steps to safeguard market stability and prompt release of relevant information.
China, as one of the world's leading oil producers and consumers, has always valued market stability and is prepared to maintain contact with all relevant parties in order to preserve market balance and long-term stability, expand cooperation, and collaboratively address issues, he added.
Oil prices had fallen nationwide in the week leading up to the White House statement, as energy corporations anticipated a large boost in supply from the government and markets fretted about a spike in COVID-19 cases throughout the world. The announcement from the White House boosted oil prices by 3% on Tuesday.
Other countries have also made efforts to enhance oil supplies in the market, though Biden's declaration is the greatest to far. India has pledged to release 5 million barrels for usage, while South Korea and the United Kingdom have each pledged 1.5 million barrels. Japan and China have also stated that they will release supplies, though no exact figures have been given.
Per USA Today, the COVID-19 pandemic upended global supply networks, with energy-hungry countries reemerging from lockdown outstripping oil supply, which was generated at a reduced level during the pandemic.