China will surpass the United States as the biggest crude oil importer by 2017 as its economy continues to grow and as Chinese drivers push up demand for fuel, according to a report on Tuesday by global energy consultancy Wood Mackenzie.
According to the report, China will spend $500 billion annually on crude imports by 2020.
"The price China pays will far outstrip the peak cost ever incurred by the US of $335 billion annually with US import spend falling to only $160 billion annually by 2020," the report said.
From 2005 to 2020, China's oil imports will rise from 2.5 million barrels per day to 9.2 million barrels a day. US imports, on the other hand, will fall from a peak of 10.1 to 6.8 million barrels per day within the same period. That roughly represents a 360 percent increase in China's crude oil imports and a 32 percent decline for the US during that period.
As a result, the amount of oil from the Organization of the Petroleum Exporting Countries that China will import is expected to rise from 52 percent to 66 percent within that timeframe. Comparatively, for the US, OPEC crude will fall to 33 percent of US total imports, while Canadian crude will account for 60 percent of US imports.
The opposing trends will not only affect each country's energy costs, but also how each country trades across the globe, said William Durbin, Wood Mackenzie's Beijing-based president of global markets.
"By 2020, 70 percent of China's oil demand will come from imports. On the other hand, US import requirements will reduce due to tight oil production," Durbin said. "The US is becoming more North America-centric for its supply needs and China more dependent on Middle East and OPEC crude. We will therefore see OPEC suppliers, who traditionally focused on the US for crude sales, compelled to shift their focus toward China."
Copyright, China Daily, 2013.