A vessel loaded with Qatar LNG docks at Rudong county, Jiangsu province. (XU CONGJUN/FOR CHINA DAILY)
China and Arab nations, which have cooperated in the oil and gas sector for decades, should continue to expand investments in energy and promote the development of new energy business including solar and wind power, a Chinese think tank has said.
The economic and industrial structures of China and Arab countries are highly complementary with energy as the basis for mutual cooperation. Collaborating in oil and gas has substantially promoted global development during the past few decades and positively contributed to the stability of the international energy market, said Yu Guo, executive director of the Economies and Technology Research Institute under China National Petroleum Corp.
The demand for oil and gas is expected to grow further amid China's transition to green energy and cooperation in the sector will only accelerate in the years ahead, he said.
Yu released a report — Review and Outlook on China-Arab Energy Cooperation in Hainan province — during the 7th China-Arab Energy Cooperation Conference held by the National Energy Administration and the institute on Tuesday.
The prospects for Sino-Arab cooperation in the green energy sector are also vast, Yu said, as both sides have been expanding ties from traditional fossil fuels to renewable energy.
According to the report, China imports 53 percent of its crude oil and 16 percent of its natural gas from Arab countries, while they export 31 percent of their crude oil and 18 percent of their natural gas to China.
Arab countries supply China with over 300 million metric tons of oil equivalent in oil and gas every year, strongly supporting its manufacturing sector, while the nation's export volume accounts for 14 percent of the global total, providing a significant driving force for global economic development, it said.
In the field of new energy, Arab countries have favorable conditions and a significant amount of solar and wind energy resources, while China is the world's largest user of new energy. Bilateral energy cooperation has promoted global development and contributed positively to the stability of the international energy market, it said.
According to Yu, trade volume between China and Arab countries has expanded continuously in recent years, especially in the energy sector. Investments, particularly in the energy sector, have also increased steadily.
China is the largest trading partner of Arab nations with a trade value of $430.1 billion in 2022. Energy trade, primarily in oil and gas, accounts for 49.35 percent of the total bilateral trade. In 2022, China imported 272 million tons of crude oil and 17.32 million tons of LNG from Arab countries, according to the institute.
Energy has always been a cornerstone for cooperation, said Yu.
While Arab countries' investments in China are concentrated in sectors like petrochemicals and chemicals, China's investments there are in areas such as oil and gas, chemicals and logistics. Amid an energy transition, these investments are expanding into the field of new energy as well, he said.
China has been stepping up economic efforts in Arab countries beyond traditional oil and gas cooperation, against a backdrop of the ever-growing energy cooperation between the two sides, said Luo Zuoxian, head of intelligence and research at the Sinopec Economics and Development Research Institute.
China's investment in the energy sector of Arab countries has effectively promoted local oil and gas production, Luo said.
At the same time, Arab countries, by supplying oil and gas to China, have also provided significant support for the country's manufacturing industry, he said.
Countries like Saudi Arabia are rich in oil and gas resources, while Arab countries overall have vast desert areas that can facilitate local photovoltaic power generation. They have stepped up efforts in green energy transition in recent years, which will further strengthen bilateral cooperation going forward, he added.