Effect Of Crude Oil Import Risk On Crude Oil Import Cost And Economic Development In China

As it is known to all, oil is an important industrial basic material and strategic reserve of China, which is also vital to stable and healthy development of economic and implementation of national strategy. Whether we can obtain the oil supply securely and stably will provide guarantee to the economic, political and military security in our country.Economy has developed rapidly during these years, as a result, oil demand in China also appears a rapid growth. Currently, because of the obvious insufficiency domestic oil production capacity and supply capacity, a sharp contradiction of supply and demand takes place. The reliance on foreign oil imports increases, especially in Africa and Middle East. Our country became a net oil importer since 1993, which marks several decades of self-sufficiency in oil supply situation has ended. With the continuous improvement of our dependence on foreign oil imports and importing oil scale, imports risk factors will definitely increased gradually. It will undoubtedly affect the stable supply of oil, which makes Chinese oil security situation in the future even more serious. And our performance in the process of international economic globalization will largely depends on whether there is a stable and secure oil supply.Firstly, provide a simple introduction on the basic situation of Chinese crude oil import risk, crude oil cost and economic growth, highlighting the problem of oil security. Then use Herfindahl-Hirschman Index between the year 1988 and 2013 reflecting the risk of Chinese import of crude oil in order to examine the trend of geographic concentration rate on crude oil import. Then quantify the cost of imported crude oil as well as economic growth and analysis them separately. Conclusion will be drawn on what influence will be brought to the cost of imported crude oil and economic growth when crude oil import risk changes.Whether Chinese crude oil trade can develop stably and healthily plays a decisive role in oil supply security. The author provides suggestion on how to resolve Chinese crude oil import risk, including diversification of source, diversification of trading modes,diversification of transporting modes as well as continuous completion of strategic oil reserve. Among the suggestions author emphasizes on analyzing the diversification strategy of importing source by analyzing the crude oil output countries and regions in the future. Hope that it will bring inspiration to the future development of Chinese crude oil trade, and play a positive role in the entirely international trade.