Wanting to lower the price of black gold, China confirmed on Wednesday that it would draw on its oil reserves, in collaboration with other countries. “China, in view of its current needs and conditions, will draw on its national crude oil reserves and take other necessary measures to maintain market stability,” a ministry spokesperson told reporters. Chinese Foreign Minister, Zhao Lijian.
The latter did not specify when these withdrawals would take place or how much oil Beijing planned to put on the market. His remarks follow statements by US President Joe Biden, who on Tuesday announced a “major initiative” to lower the prices of black gold. Washington will put into circulation 50 million barrels taken from its strategic oil reserves, the largest quantity ever drawn.
A price of the barrel which did not stop increasing
The United States has also indicated that China is joining this initiative, just like India, Japan, South Korea and the United Kingdom, without giving further details on this point. When questioned, the spokesperson for Chinese diplomacy did not mention the other participating countries.
The Chinese ministry spokesman confined himself to declaring that he had taken note of “recent measures taken by major consumer countries to maintain market stability”. “China is in close communication with various stakeholders, including consumers and oil producers,” he said.
The price of a barrel, which had fallen below 20 dollars at the height of the epidemic, has since continued to climb until it reached the level of its peaks at the end of 2018. Thus, by increasing the supply, China and the other states are hoping to mechanically lower prices, while putting pressure on producing countries.