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Determinants of China's energy imports: An empirical analysis

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  • Zhao, Xingjun
  • Wu, Yanrui

Abstract

Sustained economic growth in China has triggered a surge of energy imports, especially oil imports. This paper investigates the determinants of China’s energy import demand by using cointegraiton and VECM techniques. The findings suggest that, in the long run, growth of industrial production and expansion of transport sectors affect China’s oil imports, while domestic energy output has a substitution effect. Thus, as the Chinese economy industrializes and the automotive sector expands, China’s oil imports are likely to increase. Though China’s domestic oil production has a substitution effect on imports, its growth is limited due to scarce domestic reserve and high exploration costs. It is anticipated that China will be more dependent on overseas oil supply regardless of the world oil price.

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Bibliographic Info

Article provided by Elsevier in its journal Energy Policy.

Volume (Year): 35 (2007)
Issue (Month): 8 (August)
Pages: 4235-4246

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Handle: RePEc:eee:enepol:v:35:y:2007:i:8:p:4235-4246

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Citations

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Cited by:
  1. Hengyun Ma & Les Oxley & John Gibson, 2009. "China’s Energy Situation and Its Implications in the New Millennium," Working Papers 09_04, Motu Economic and Public Policy Research.
  2. Li, Hong & Xiaowen Lin, Sharon, 2011. "Do emerging markets matter in the world oil pricing system? Evidence of imported crude by China and India," Energy Policy, Elsevier, vol. 39(8), pages 4624-4630, August.
  3. Walls, W.D., 2010. "Petroleum refining industry in China," Energy Policy, Elsevier, vol. 38(5), pages 2110-2115, May.
  4. Moore, Alvon, 2011. "Demand elasticity of oil in Barbados," Energy Policy, Elsevier, vol. 39(6), pages 3515-3519, June.
  5. Kim, Hyun Seok & Baek, Jungho, 2013. "Assessing dynamics of crude oil import demand in Korea," Economic Modelling, Elsevier, vol. 35(C), pages 260-263.
  6. Roberts, Ivan & Rush, Anthony, 2012. "Understanding China's demand for resource imports," China Economic Review, Elsevier, vol. 23(3), pages 566-579.
  7. Lin, Boqiang & Ouyang, Xiaoling, 2014. "Electricity demand and conservation potential in the Chinese nonmetallic mineral products industry," Energy Policy, Elsevier, vol. 68(C), pages 243-253.
  8. Camacho-Gutiérrez, Pablo, 2010. "Dynamic OLS estimation of the U.S. import demand for Mexican crude oil," MPRA Paper 30608, University Library of Munich, Germany.
  9. Ou, Xunmin & Zhang, Xiliang & Chang, Shiyan, 2010. "Scenario analysis on alternative fuel/vehicle for China's future road transport: Life-cycle energy demand and GHG emissions," Energy Policy, Elsevier, vol. 38(8), pages 3943-3956, August.
  10. Suganthi, L. & Samuel, Anand A., 2012. "Energy models for demand forecasting—A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(2), pages 1223-1240.

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