China plans to sell some oil from its strategic reserves, just days after the United States invited it to participate in a joint selling deal. A spokesperson for the National Food and Strategic Reserves Administration stated that "the administration is preparing to launch crude oil sales at the moment." It is unclear whether Chinese authorities are doing this in response to Washington's invitation or if they had pre-existing plans to do so. The news was first reported by Reuters.
These developments follow a virtual summit this week between U.S. President Joe Biden and Chinese President Xi Jinping, during which they discussed the benefits of releasing oil from strategic reserves. The move aims to ensure stability in global energy markets after crude oil prices reached their highest levels in several years last month. Washington is pressuring Asian countries, including China, India, Japan, and South Korea, to join its efforts to increase supplies after "OPEC+" producers rejected requests for more crude.
Officials stated that no decisions were made during the summit, although both sides agreed to continue discussions regarding the state of oil markets and potential coordinated responses. Beijing and Washington currently share similar concerns about rising oil prices, fuel, inflation, and the impact of escalating costs on their economic recoveries.
This year, China has utilized its national inventories in an attempt to lower domestic crude oil prices. In September, the reserves office held a first public auction, offering 7.4 million barrels for sale, which is equivalent to less than one day of China’s imports. The country also conducted a private sale of its reserves prior to the auction. The spokesperson for the reserves office indicated: "We will release more details about the volume of oil and the date of the sale on our website in due course, as we did in the first public auction."
