Michael G. Gallagher
Abstract: This article argues that China faces an economic crisis that stems from its dependency on a domestic petroleum industry that is characterized by political difficulties, technical foul-ups, personnel shortages, and credibility gaps. China’s prospects as an oil producer were not seriously pursued until the take over of the Communist regime in 1949. Additionally, with the discovery of the Shengli and Takang oil fields in the 1960s, China was able to increase production of oil and decrease its net imports. This article gives a detailed overview of the political and economic developments that shaped China’s rising oil industry in the 1960s and 1970s and discusses how the strength of China’s oil industry is yet another source of Western misconception. The article concludes that China’s oil industry faces very credible threats, including the stagnation of onshore oil production, which is exacerbated by its rapidly growing energy consumption. In conclusion, the article suggests that the image of China as a net oil exporter will soon be inaccurate, leading to widespread energy shortages.
Keywords: oil refineries, technological development, crude oil, Communism, energy shortages, Cultural Revolution, offshore production, onshore production
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