Fueling The New World Order: Where Does China Import Its Crude Oil From?

Tyler Durden's picture

It was roughly half a year ago that China officially surpassed the US as the world's largest importer of oil. Since then, there have been some rather dramatic changes in the global geopolitical landscape, perhaps the most important of which are the ever louder and bolder attacks on the US petrodollar and the reserve currency status of the US dollar which funds the global crude trade. As reported recently, Russia and China, not to mention India and Iran and the other BRICs, are increasingly pushing for a trade system in which the USD is isolated - a key precondition to the loss of reserve status.

However, as China's ravenous appetite for oil surpasses that of the US which is enjoying an unexpected, if transitory, boom of shale oil production, which according to some experts may have already peaked, it means suddenly China is far more are the mercy of its core suppliers - the same way that for decades the US had no choice but to be best friends with Saudi Arabia, at least until Canada became the biggest supplier of crude to the US by a huge margin.

So which are the countries that China relies most on for its daily energy importing needs? The map below has the answer.

Or, in ranked format (for 2011):

  1. Saudi Arabia
  2. Angola
  3. Iran
  4. Russia
  5. Oman
  6. Iraq
  7. Sudan
  8. Venezuela
  9. Kazakhstan
  10. Kuwait

Saudi Arabia on top makes sense, but #2 for... Angola? Well, at least that explains this: "Guess The World's Most Expensive City"...

Also looking at the map above, it is quite clear that if one were so inclined, halting seaborne trade routes at the Strait of Malacca would hobble the entire Chinese economy overnight, something the Chinese leadership is surely aware of, and is certainly considering alternatives to, such as land pipelines into Iran (via India), as well as Kazakhstan and Russia.

So how do these compare with the outside sources of US crude?

Quite clearly, the primary external provider of US energy needs is no longer Saudi Arabia, but Canada, which is now exporting more than double the bpd amount as the second largest oil exporter, one time US bff in the middle east, Saudi Arabia.

Curiously, as Canada's dominance has soared, the influence of all the other traditional petrodollar countries has waned. But only for the US - as the first chart shows, their influence is far greater now when it comes to China.

So isn't it only logical that it is only a matter of time before the New (Oil) World Order decides to eliminate the USD - an anachronism from when the US relied first and foremost on just these oil exporting countries - entirely from the oil trade, and moves on to the Chinese Renminbi. Of course, that would require the Chinese currency to be flexible and convertible, something it certainly isn't now... but what about 1 year from now, or 2 years or 3? And how long before the PBOC also reveals just what its true and updated gold holdings are? What is the probability the two events would coincide?

For some more curious observations and thoughts on fueling the New World Order, we recommend the following recently released research paper by the Brookings Institute (link)

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Soul Glow's picture

Peak oil, bitchez

And FYI oil world oil production from Q4 '13 to Q1 '14 was flat.  This in the face of a media spouting lies about ever increasing production.

AssFire's picture

Who cares about war?

One time US bff in the middle east, Saudi Arabia might un-friend us!

After all we have done to help them suppress their citizens.

Four chan's picture

the us invented saudi arabia.

jughead's picture

Was that before or after AlGore created the Internet?

swmnguy's picture

Let's see.  Where are there American military "boots on the ground?"  Let's keep an eye on southwest Africa in the coming years.  What we see may be instructive.

Winston Churchill's picture

Poor Afghanistsn, now its the Chinese's turn.

Kirk2NCC1701's picture

They're waiting for the US to leave, so they can FINALLY put in the Iran-Afghanistan-China pipeline, that Bush-Cheney prevented with their post-911 invasion.

Don't kid yourself, that was the only real reason the US went in.  All else was deception, lies, smoke & mirrors.  But the 'Mericans bought the story.  Hook, line and sinker.  Right into the gut.

cossack55's picture

True that.  

WTF is ZH doing with Brookings Institute propaganda shit story.  Next they will be quoting the ICG.  Again, WTF?

carbonmutant's picture

Strait of Malacca bitchez...


CrashisOptimistic's picture

This is a good article.  Nothing hugely new in it, but it's a subject seldom covered well.  Good going Tylers.


I'll offer up thoughts:

1) Chinese domestic production of oil is a big cloudy question mark.  State secret.  Most of it comes from their northeast region and they are hoping to do a Eagle Ford shale / Bakken clone there.

2) Canadian oil has one customer.  The US pays less for it than it pays for even WTI.  This is a bit unfair and if the Canadians ever do approve a pipeline to the Pacific, Japan and China as competing demand will change that forever.

3) Before we knee jerk on that, note that Canadian oil is viscous.  Thick stuff.  A lot of condensate from shale sources flows north to Canada to dilute it so it will will flow easier and process easier.  It is called diluent and is some legitimate justification for lower price.

4) It is one helluva lot more difficult to stop Canadian flow to the US than it would be to bomb tankers to Shanghai.

DoChenRollingBearing's picture

Your observations are always worthy.  It does show that our important rival China has weaknesses not fully understood by BRICS fans.

aka_ces's picture

"It does show that our important rival China has weaknesses not fully understood by BRICS fans."


it's not us vs. them, but rather it's the U.S. state vs. the Chinese state, and both states vs. Americans and vs. Chinese.

LstrzMnyn's picture

I disagree here.

Sure, you can make that cliche'd observation that we are not technically the state and it is not us(and they are against "them"), but in very real terms--real by the power of the facts they represent--it is us against the Chinese because we, the people, depend upon those institutions and utilities closest to us for our day-to-day survival. Meanwhile, the US Navy has absolute control over every strait and byway throughout the world, and there is NO competition. These carrier task forces are pretty hardcore from what I understand, virtually floating armies all over the world that can strike anywhere, at any time. So whatever threatens the US military threatens us.

This applies as much to taking the dollar out of the oil equation. This is a moot point. Doesn't Saudi Arabia realize, as much as any other country on earth, that if you start to play with "independent" ideas, the US will find you and crush you. They are merciless, as has been seen already, and is being seen to this day. The question, then, is how much of the world's other people, at any given time, might be compelled to simultaneously throw off the yoke? This would be the only way. Just like against Napoleonic France in 1813, when it demanded all of Europe together to take down the beast, so must the world as a body unite against this beast. As yet there are strong accusations out there, and it seems as if the US is bent on turning the screw whenever she has the chance. Only of late has she been checked, once in Syria and again in Crimea, but it's a side of US leadership that isn't often seen.

Right now, if it was USA vs WORLD, the USA would win. Too much power. Too much technology. Too much proximity, because we have bases all over the world. 

The United States is still far too powerful, and still far too insane, for anyone to be able to challenge her.

aka_ces's picture


Yes, the serfs suffer when the lands of their lord are overrun by the knights of an another lord.  And the serfs may consider consider their lord as their benefactor. Such is feudalism. 

Totentänzerlied's picture

"if the Canadians ever do approve a pipeline to [not-America]" ... they would be in for one hell of a not-so-covert terror and assassination campaign until they came to their Manifestly Destined senses.

Nice Straits you got there, Mallaca, 'd be a shame if something were to happen to 'em...

CrabNuggetOne's picture


"more difficult to stop Canadian flow to the US than it would be to bomb tankers to Shanghai"

Yes, but you could just as easily be nuked. After all why should the rest of the world put up with your shit anymore?

I mean, we've just to keep taking up the shitter from you fucks?


Omen IV's picture

There is a book out by a Canadian woman on Canda becoming part of USA - today on McLaughlan Report - but she has been everywhere -

the USA wants to eliminate the effect on the US dollar from Canadian sale of oil and gas - as largest and growing importer the effect is huge of no dollars exchanged for Canadian - the Scots in Canada will not stand for it

Kayman's picture

"stop Canadian flow to the US"

China doesn't have to worry about that, Barry's already stopping Canadian oil. On China's behalf ?  

Chief Kessler's picture

It says 3.5 million barrels per day come in fro canada dipshit, stopping what? The keyster pipe? Next time put some popular science in the shitter of your trailer instead of Dork Dynasty illustrated.

Flakmeister's picture

And currently afair amount of that Canadian oil making to the GOM is tagged by export as tax-free refined goods...

Basically a way to arbitrage the tax code via crack spreads and cheap bitumen inputs...

It it things like this that reveal how the system is really rigged for the benefit of a few....

marathonman's picture

Not to mention that it suppresses the prices of Canadian crude benefitting mid-western refiners and creates a new market for oil rail transport.  Why look who showed up to sop up that lucre!?  It's Uncle Warren Buffet buying up rail lines!  Whoever would have thunk it? 

Raging Debate's picture

Kaymen - Your the wisest on tge thread so far. The US itself is owned by the Rothschild's. Investment flowed East as it was inevitable that wages and the social system would not be able to be sustained.

The Central Bank model for a reserve currency host is an empire. One that lasts for eighty years. The US got the reserve currency in 1932z

We in America at mostly $12 an hour wages and no benefits (people were making this in the 70's with benefits and cos of living has tripled) are now viewed as competition for a little longer.

However IF self-determination is restored, you see that happen expect to see a nuke attack on the US. The Republic will be restored in the end and justice served. Those wishing and enjoying the death of Uncle Sam (brand is tarnished beyond repair) and innocent (naive) Americans will not enjoy the end result to yourselves.

We all lose this time. Including the Council of Nine. Such is the nature of our species. This dimension sucks. But the good news is we are nearing the end of our biomechanical evolution. Thank God I grow bored here.

Kirk2NCC1701's picture

You don't have to be straight to be a Malaka, but being a Malaka makes you straight.  -Greek joke

post turtle saver's picture

... a wretched hive of scum and villainy for centuries, and an unquestioned perfect setup for "piracy"

Matt's picture

Unlike a pipeline, an oil tanker can simply travel a different route. If the Strait of Wankers was closed, the oil tankers could simply go around. Longer, slower, more expensive, but not insurmountable.

PacOps's picture

The Sunda Strait (next one south between Sumatra and Java) is unsuitable and dangerous for oil tankers, also easily blocked. Running south of Java to go around has its challenges as well. I worked these waters back in the 70's positioning offshore oil rigs with the first GPS system or SatNav as it was known back then.

Not insurmountable but taking a tanker outside of safe known passage in SE Asia is very high risk.

post turtle saver's picture

you have no concept of the scale of distance at play in this region... "simply" is not an appropriate word here

Moe Hamhead's picture

Another piece arguing for the politicizing of oil, ho-hum.  The US DoD is the world's largest single consumer of eneergy!

CrashisOptimistic's picture

What exactly does that mean?

DoD burns 380K bpd.  Greece burns that.  Italy burns more.  What is a single consumer?  DoD is four or five or six or seven "agencies'.

How do you want to lump these?  Ya, DoD burns more than any other country's military.  DoD also has a larger economy to defend than any other country's military.

Notsobadwlad's picture

Ahhh ... so the US DoD is single-handedly responsible for global warming. Well, maybe the DoD and all of the bloated industries supporting it are responsible...

Maybe it is time to retask the US DoD to a defensive mode for the US only. I personally do not see how the DoD is currently defending anything. It looks to be a bloated bully primarily concerned with creating business for itself... and funneling money to insider cronies and corrupt dictators. There is no honor in that.

... don't shoot the messenger, just saying how it looks from the outside. Maybe the DoD should try letting its actions speak louder than its words. Actually, I suppose, right now they do.

Raging Debate's picture

Notaobad - Of course it looks that way because your right. Part of the job of reserve currency is protecting global trade. The benefits haven't flowed to the American people in well over 15 years.

We all got poorer here except for a very tiny minority. Instead, it has flowed to cronies while we get the tax bill to make political insiders multimionaires AND fund the new host nation China.

Moe Hamhead's picture

I'm just qouting the report (page 8).

CrabNuggetOne's picture

Quite simply bullshit. The US military burns HALF of the entire worlds diesel, not even paid for (as you know).

You theiving, murdering nation of cunts.

CrashisOptimistic's picture

haha, what?

Heavy trucks consume 10% of US total oil consumption, which is about 18.5 mbpd.

So heavy trucks, civilian US heavy trucks, are doing 1.85 million bpd.  All of it is diesel.

The entire DoD oil consumption is about 385K bpd.  That includes light vehicle gasoline and jet aircraft kerosene equivalents.

Dood, why don't you just look stuff up before being crazy.

Chief Kessler's picture

they cant because 50% of ZHers are redneck trailer trash who couldnt find the truth if you shoved it up their gigantic wifes ass, uneducated, over religious zealots, living in the past, btw it is all obamas fault

LstrzMnyn's picture

Is there some specific issue you would like to discuss concerning the general United States population and "cunts"? Most of us are well aware of the geo-political construct and it's activities--as well as it's effects. Sure, it sucks that oil leaves a path of destruction behind it, but in urban and suburban US areas, consuming oil for transportation is an absolute neccesity. It would be suicide, and clearly irresponsible, to abandon what is so easy to obtain and such a marked financial benefit for owns own survival. So, check out that collar. We're wearing the same one. We don't have any more power over these things than you do.

logicalman's picture

The difference between US and China seems to be that China makes deals, the US invades and steals.

Given China's gold production and imports, pricing oil in Au would seem to be where this is heading.



Notsobadwlad's picture

Who really controls the US? Is it the people? Probably not. Is the it industry and politicians or the banks that create money from nothing and use it as both a carrot and a hammer to control industry and politicians.

Maybe China is not yet controlled by the bankers and so their methods are different.

Good people do not send in thugs to create terror and murder innocent people and steal their stuff, no matter how deep the greed.

I believe the useful idiots in the US government and industry are being played as fools to be corrupted and do the dirty work of very malevolent forces.

EconomicGenocide's picture

The world fought to defeat Nazism only to be enslaved by Zionism!!!!!

And the US is currently the biggest plantation!!

valley chick's picture

Well looky there...#4 Russia.  And when in May does Russia and China sign the trade agreement?

CrashisOptimistic's picture

A good question.

A better question has to do with the pie itself.  Yes, Russia is 4th largest piece of their supplier pie.

But China buys 20+ million cars per year, and old cars don't get junked when a new one arrives because they are newly rich.  It's all new consumption. 

20 million X 30 miles driven/day / 25 miles per gallon / 42 gallons per barrel =

571,000 barrels/day of new consumption Every Single Year added.

That will be out of a total consumption of 10.7 million bpd.  Call it 7%/year.

EIA estimates a lower number in 2013 at 380K, but they have a lower car buy presumption from the weak 2012 year of car sales.

Regardless, this is a relentless increase in consumption that isn't being particularly matched by global oil production.

sushi's picture

halting seaborne trade routes at the Strait of Malacca would hobble the entire Chinese economy overnight, something the Chinese leadership is surely aware of.

The flip side to this is that China seeks to reactivate the overland "Silk Road" to Russia and beyond to Europe. Pipelines have already been laid along this route and a rail connection is progressing.

Of course once this set of logisitcs channels are in place the USSA will lose the abilty to "turn off the tap" at the Strait of Malacca chokepoint. When this happens the ability of the USSA to exert military pressure against China will diminish significantly. At the same time the economic links between China, Russia, and Europe will increase.

One way for the USSA to frustrate such a development would be to pick a large country on the Russia / Europe border, create social unrest, reignite the need for militarism, and create enough of a panic to shut the entire new Silk Road venture down.

Ukraine is a large country on the border between Europe and Russia. You figure it out.

CrashisOptimistic's picture

All true, but we are talking about many millions of bpd that would have to move from tankers to pipelines.  It's not going to happen any time soon, or maybe ever.

As shale sources roll over their top, and Canada peaks as well, US tanker reliance will grow, too (and it's substantial now), so there is nothing one sided in this.

Perhaps the most ugly reality of all is Japan.  They are ALL tankers.

MsCreant's picture

Look at all those straws! They are drinking OUR milkshake!

Soul Glow's picture

The milkshake example is a deep one.  Oil is drawn from the bottom of the field - think of it like putting a straw in a milkshake and the straw sits at the bottom.  Now imagine that the milkshake is in a dark container where you can't see how much is left.  This is what it is like drawing oil - the producer never knows how much is left until, "Shit man, it's gone."