Business · Energy & Commodities · 3 hrs ago
China Urges Domestic Producers to Raise Oil and Gas Output
China’s National Energy Administration has urged PetroChina, Sinopec, CNOOC and other producers to expand domestic oil and gas production.
The call followed an October 21 meeting as disruptions to Middle Eastern shipments and the Iran war tightened supply.
China had built large oil reserves, estimated at 1.3 billion to 1.4 billion barrels when the war began in February, and used them to reduce costly imports.
But refiners have drawn on those stocks repeatedly, and Iranian crude previously available to Chinese buyers has reportedly run out.
That leaves China needing to replace discounted Iranian oil with costlier supplies from elsewhere, while high freight costs add to the pressure.
China and Russia have agreed to support companies seeking more oil cooperation, but no new supply commitments were announced.
Beijing’s directive calls for steady growth in crude output and faster growth in natural gas, while the next steps on Russian cooperation remain unspecified.
China’s National Energy Administration has urged major domestic oil and gas producers to expand production capacity, investment and supply bases.
The directive calls for steady growth in crude production and rapid growth in natural gas output.
The push follows disruptions to Middle Eastern oil shipments and the reported disappearance of Iranian crude from the market.
China has relied on crude inventories to reduce imports during the Iran war, but has drawn on its stockpiles in several recent months.
- Who
- China’s National Energy Administration urged PetroChina, Sinopec, CNOOC and other domestic producers to increase output.
- What
- The agency called for expanded production capacity, increased investment and faster development of national oil and gas supply bases.
- When
- The directive followed an October 21 meeting. The article was published October 26, 2026.
- Where
- China.
- Why
- Disruptions to Middle Eastern oil shipments and the reported drying up of Iranian crude supplies have increased pressure to strengthen domestic production.
This story does not have two clearly opposing sides.
The Iran war began, and China had an estimated 1.3 billion to 1.4 billion barrels of crude in commercial and strategic inventories.
China’s crude imports fell by an estimated 4.4 million barrels per day compared with the 2025 average.
Chinese refiners processed approximately 13.99 million barrels per day of crude, while domestic production contributed 4.43 million barrels per day.
Kpler estimated that Iran’s floating crude inventories available for delivery to China had fallen below 1 million barrels and were subsequently exhausted.
China’s energy agency issued its directive following a meeting; China and Russia also agreed to support companies seeking to expand oil cooperation.
- Producers named
- PetroChina, Sinopec and CNOOC
- Crude output target
- Steady growth
- Natural gas output target
- Rapid growth
- Chinese onshore crude stocks
- Approximately 1.192 billion barrels in the week ending October 19
- Inventory change
- 162 million barrels below the early May record