Damien Ma
The energy shock brought on by the Iran war is still percolating, but those shockwaves will not hit countries with equal intensity. The consensus believes China is well-positioned to withstand the shock, given the ample commercial and strategic petroleum reserves at its disposal (at least three months), so long as this does not turn into a forever war, which looks less likely with the ceasefire. The Chinese stock market performance also implies that investors have generally bought into this consensus.
But beyond China’s stockpiles, a basic reality appears to have been overlooked in the flurry of commentaries on the war’s impact on China. The country’s energy security isn’t really tied to oil or gas, for which the country does depend on imports. It has always been inextricably linked to coal. China consumes more than half of the world’s coal, and it is the main commodity that powers Chinese industry and the electricity system.
No comments:
Post a Comment