For the first time in years, China’s national oil companies (NOCs) are presumed to boost spending in 2017. CNOOC Ltd. announced it had allocated $10 billion (U.S.) to produce 450—460 barrels/day. PetroChina Co. and Sinopec Corp. are both expected to do the same, although their focus will be on natural gas exploration and production.
“The higher spending by China’s global companies fits into a global pattern that oil firms are adjusting up their capex (capital expenditures) this year after two years of slumps,” Wang Yushuang, a Beijing-based analyst with Wood MacKenzie, was quoted as saying in an interview. “In China, large and mid-cap companies’ capex is expected to grow by 11.5% in 2017.”
Meanwhile, China’s central government could cut import quotas for some of the country’s independent refiners (affectionately called ‘teapots’). Demand growth is focused on these refiners and any policy move could put a dent in China’s overall oil imports.
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