Prince Abdulaziz Bin Salman, Saudi Energy Minister, and Zhang Jianhua, Director of the National Energy Administration of China, emphasized the importance of long-term and reliable crude oil supply. Both officials confirmed their willingness to work together to support the stability of the international oil market.

Zhang Jianhua, Director of National Energy Administration

China is the world's largest crude oil importer and the world's second largest economy. Since the beginning of the Ukraine war, China has been buying discounted crude oil from Russia. Although the transaction price of Russian crude oil is lower than the market price, the export to China and India has not further increased. We believe that China may aim to avoid Europe's mistake of relying too much on one country and would rather keep the largest share of an exporter at 20%. The mobility restrictions related to coronavirus limit the growth of China's oil demand.

Prince Abdulaziz Bin Salman, Minister of Energy of Saudi Arabia

Since 2020, China has been pursuing the zero Covid policy, demanding a complete blockade, even in the case of minor outbreaks. Frequent blockades have affected China's large manufacturing industry and disrupted the global supply chain. The oil market has been tense since the OPEC+Union, an oil producing country, cut its output by 2 million barrels/day due to the expected economic slowdown.

According to the data of the Joint Organization Data Initiative, Saudi Arabia, the world's largest oil exporter, increased its crude oil production by 236000 barrels per day in August, reaching 11.05 million barrels per day, while the export volume in that month soared to a two-year high of 7.6 million barrels per day. The discussions between Prince Abdulaziz and Mr. Zhang included cooperation and joint investment of countries along the the Belt and Road, as well as investment in comprehensive oil refining and petrochemical complex. The two officials also stressed the importance of cooperation in the fields of electricity, renewable energy and clean hydrogen.

In the second quarter of 2022, China is Saudi Arabia's largest trading partner, with an export volume of 16.9 billion US dollars. India and Japan followed closely, with exports of 43.5 billion rials and 39.1 billion rials respectively. At the same time, Saudi Arabia imported 34 billion SAR from China in the second quarter, making it the largest source of Saudi imports. The United States and the United Arab Emirates followed closely, with imports of 15.4 billion rials and 11.2 billion rials respectively.Editor/Xing Wentao