China's oil and gas industry analysis and outlook series of blue books released

On April 15th, By the China Petroleum Enterprises Association, the Belt and Road Energy Trade and Development Research Center of the University of International Business and Economics, the China Institute of International Low Carbon Economy, the University of International Business and Economics, the China University of Petroleum ( Beijing), Southwest Petroleum University China Energy Index Research Center jointly compiled the "China Oil and Gas Industry Development Analysis and Outlook Report Blue Book (2022-2023)" referred to as "Oil and gas industry Blue Book", "China Low Carbon Economic Development Report Blue Book (2022-2023)" (referred to as "Low carbon Economy Blue Book") "Refined oil and new energy development report blue paper The book (2022-2023) (referred to as the "Blue Book of Refined Oil and New Energy") and the Blue Book of the Annual Operation Report of China's Natural Gas Industry (2022-2023) (referred to as the "Natural Gas Industry Blue Book") were officially released to the public in Beijing.

4 This Energy Blue Book is an in-depth report that studies and analyzes the status quo and trend prospects of the development of China's and even the world's energy industry chain from a full perspective and is currently published in China. By building a multi-equilibrium model framework, the research team will observe and analyze the changes in China and even the world energy market in 2022, including the geopolitical game, national energy policies, the evolution of the global industrial chain and the integration of business models, as well as the resulting changes in the upstream and downstream links, and predict and evaluate the market trend, process and development trend in the future period. The Blue Book is not a yearbook in the general sense, but a think tank view and report based on annual analysis and outlook for the next year. It aims to provide the industry with a panoramic and three-dimensional picture of the evolution of the oil and gas market, and at the same time, it describes and analyzes the market fluctuations, and gives the forecast and judgment methodology.

According to the Blue Book of the Oil and Gas Industry, in 2022, the remaining proved reserves of global oil are 240.69 billion tons, an increase of 1.3%. The world's remaining proven reserves of natural gas were 211 trillion cubic meters, up 2.2 percent year-on-year. Global oil production was 4.349 billion tons, up 2.8% year-on-year. Global gas production was 4.25 trillion cubic meters, up 0.4 percent year-on-year. Affected by the weakening momentum of global economic growth and other factors, the growth of world oil demand in 2022 will slow down, increasing by 2.15 million barrels per day year-on-year to 99.8 million barrels per day. Natural gas consumption fell to 4.01 trillion cubic meters, down 0.8 percent year on year. Global oil demand is expected to reach 101.9 million barrels per day in 2023; Global demand for natural gas rose 0.8% to 4.13 trillion cubic meters. Global oil and gas production is expected to continue to grow slightly in 2023, with US oil and gas production continuing to grow significantly, while Russian oil and gas production may decline more than 2022.

In the face of multiple unexpected factors at home and abroad, China's oil and gas enterprises take the protection of national energy security as their own duty, and strive to promote the increase of storage and production, which provides important momentum for the economic recovery. According to the "Oil and Gas Industry Blue Book" data, in 2022, China's new proved geological reserves of oil more than 1.4 billion tons, new proved geological reserves of natural gas more than 1.2 trillion cubic meters; Crude oil production reached 205 million tons, up 2.9% year-on-year, returning to the "safe line" of 200 million tons. Natural gas output was 220.1 billion cubic meters, a year-on-year growth of 6.07%, and an increase of more than 10 billion cubic meters for five consecutive years. At the same time, China's imports of crude oil 508.28 million tons, down 0.9% year-on-year, crude oil dependence dropped to 71.2%; Imports of natural gas were 109.25 million tons, down 9.9% year on year, and the dependence on foreign natural gas dropped to 40.2%. Oil and gas production and sales show a trend of "two increases and two decreases". It is expected that in 2023, China's oil and gas production will continue to grow, crude oil production will stick to the "200 million tons +" safety line, and natural gas production will exceed 235 billion cubic meters.

In 2022, China's ecological civilization construction will enter a critical period with carbon reduction as the key strategic direction, promoting the synergy of pollution reduction and carbon reduction, and realizing the improvement of ecological environment quality from quantitative change to qualitative change. According to the Blue Book of Low Carbon Economy, in 2022, China's energy consumption per 10,000 yuan of GDP will be reduced by 0.1 percent from the previous year, and carbon dioxide emissions per 10,000 yuan of GDP will be reduced by 0.8 percent, with steady progress in energy conservation and emission reduction. Since 2012, China's annual energy consumption growth rate of 3% has supported an annual economic growth rate of 6.6%, and its energy consumption per unit of GDP has decreased by 26.4%, becoming one of the countries in the world with the fastest reduction in energy intensity.

"Low carbon Economy Blue Book" pointed out that for a long time China's carbon dioxide emissions and economic growth to keep pace with the trend, at the same time, China's carbon price mechanism to promote low-carbon transition effect. By 2022, China's carbon market carbon emission quota (CEA) has a cumulative turnover of 230 million tons, with a cumulative turnover of 10.475 billion yuan. From the time dimension, the carbon price of each pilot region in 2022 has increased compared with that of 2021. From a regional perspective, Beijing's carbon price is the highest in China, followed by Guangdong, and Fujian's carbon price is the lowest. The second compliance cycle of the national carbon market in 2022 has been successfully concluded, and the market has entered the third compliance cycle in 2023. With the continuous promotion of green and low-carbon development, carbon prices may continue to rise.

According to the Blue Book of Low Carbon Economy, China has built the world's largest clean power generation system, and the installed capacity of wind, light, water and biomass power generation ranks first in the world. At the same time, China's energy efficiency has been greatly improved. In 2022, the comprehensive energy consumption per unit of calcium carbide in key energy-consuming industrial enterprises will be reduced by 1.6%, the comprehensive energy consumption per unit of synthetic ammonia by 0.8%, the comprehensive energy consumption per ton of steel by 1.7%, the comprehensive energy consumption per unit of electrolytic aluminum by 0.4%, and the standard coal consumption per kilowatt-hour of thermal power generation will be reduced by 0.2%.

With the completion and production of new refining and olefin units, the scale concentration of China's petrochemical industry, the degree of cluster of petrochemical bases, the overall technical level of the industry and the core competitiveness have achieved a new leap. At present, China's 10 million tons and above refineries have increased to 32, and the aggregation effect of refining and chemical integration has become increasingly apparent. The Blue Book of Refined Oil Products and New Energy shows that in 2022, the growth of China's refining capacity will slow down, and the total refining capacity will rise to 924 million tons/year, ranking the world's largest refining country. Ethylene production capacity increased rapidly for the fourth consecutive year, and the total production capacity reached 49.53 million tons/year, surpassing the United States and rising to the first place in the world. In 2022, affected by the sharp rise in international oil prices and the sharp decline in demand for major oil products, a number of operating indicators of China's refining industry declined and entered the trough of the business cycle. Among them, domestic crude oil processing fell 5% to 680 million tons, the first decline since the 21st century; The average operating rate of refineries was 73.8%, down 4.8 percentage points from 2021, ending the positive growth trend since 2015; The profit of refining enterprises per ton of oil in the whole industry was about 140 yuan, a sharp decline of 63% from 2021. According to the Blue Book of Refined Oil and New Energy, in 2022, affected by multiple factors, domestic oil consumption declined year-on-year, crude oil and oil dependence fell, and refined oil consumption showed a gradual recovery trend throughout the year. In the future, the domestic oil refining industry will show the characteristics of large-scale, integration, base, park, digital and green.

The "Blue Book of Refined Oil and New Energy" takes the multi-equilibrium model as the framework, starts from the dual perspectives of geography and market, micro and macro, focuses on the development status and development direction of China's oil terminal and new energy industry, and tracks and interprets the fluctuations and the logic behind them. The blue book is jointly compiled by the China Petroleum Enterprises Association and the School of Economics and Management of China University of Petroleum (Beijing), and published annually to the whole society.

According to the Blue Book of Refined Oil Products and New Energy, in 2022, China's refined oil consumption was 345 million tons, an increase of 0.9%, of which gasoline was down 4.6%, diesel was up 11.8%, and aviation kerosene was down 32.4%. Driven by the rise in global commodities, China's gasoline and diesel prices in 2022 hit a new high since 2015, and the annual volatility of gasoline and diesel prices was 37.8% and 37.4%. It is expected that the demand for refined oil products in China will recover and rise in 2023, increasing by 9.1% year-on-year. With the continuous release of new production capacity, it is expected that crude oil processing volume and refined oil production will rebound, and the market supply is relatively adequate.

In terms of new energy, in 2022, China's new installed capacity of wind power and photovoltaic power generation exceeded 120 million kilowatts, reaching 125 million kilowatts, exceeding 100 million kilowatts for three consecutive years, hitting a new record high; The installed capacity of renewable energy exceeded 1.2 billion kilowatts, reaching 1.213 billion kilowatts, accounting for 47.3% of the country's total installed power generation capacity, an increase of 2.5 percentage points over 2021. China has become an active participant and important contributor to the global response to climate change. In 2022, China's renewable energy generation is equivalent to reducing domestic carbon dioxide emissions by about 2.26 billion tons, and the export of wind power photovoltaic products will reduce carbon dioxide emissions by about 573 million tons for other countries, with a total reduction of 2.83 billion tons. It accounted for about 41% of the global renewable energy converted carbon reduction during the same period. It is expected that in 2023, China's new energy industry will maintain a good development trend, and production and sales will achieve stable growth. The oil and gas industry will accelerate the process of electrification, through the production of energy "electricity instead of oil" and "electricity instead of gas", it can replace a certain scale of oil and gas products, improve the industry's self-produced oil and gas commodity rate, and increase external supply capacity. According to the current level of domestic oil and gas production, if the electrification rate of terminal energy use is increased to 30%, it is equivalent to adding a large oil field with an annual output of 11 million tons of oil equivalent.

Throughout the history of human energy use, it has completed two energy conversions from fuelwood to coal and from coal to oil and gas, and is currently in a new stage of the third energy conversion, and fossil energy with natural gas as the main body will play an important role in this energy conversion. "Natural gas industry Blue Book" pointed out that the key to building a new energy system is to ensure energy security, high efficiency and low carbon, so natural gas will be flexible, clean, efficient and other multiple advantages, play a new round of energy transition and bridge role.