The OPEC meeting in Cairo this Friday could focus on the issue of reining in production. The hawks within the OPEC are already clamoring for OPEC output cut. “Oil markets are oversupplied by some two million barrels a day and OPEC should cut supply to official quota levels,” Iran’s OPEC governor Hossein Kazempour Ardebili argued during the build-up to the Cairo meeting. OPEC member countries pumped 27.89 million barrels per day in October, 890,000 bpd above the new official limits that came into force on November 1. Most of the extra oil is coming from Saudi Arabia, the only OPEC producer with some spare capacity.

The OECD energy watchdog, the Paris based International Energy Agency (IEA) has also been signaling to the OPEC to “exercise caution on the output policy,” so as to allow the global oil stocks to build up to adequate levels.

According to some estimates, China’s oil imports during the first 10 months of 2004 rose by nearly 40 percent compared with the same period last year. China imported a total 79.9 million tons of oil between January and August, a 39.9 percent increase on the year. The total imports for 2004 are set to reach a record 110 million tons. That would mark a 20 percent increase over last year’s total of 91 million tons, itself up by 31 percent on the total for 2002.

Analysts believe that China’s share of total world oil consumption could double to 14 percent over the next decade.

For a sense of just how vast China’s energy needs are, one needs to take the night view from the observation deck of Shanghai’s Oriental Pearl Tower. From that perch 263 meters above the city’s streets, one witnesses a spaghetti jumble of bright neon illuminating the buildings of the waterfront Bund and the swarms of shoppers on Nanjing Road. Closer at hand, the shiny skyscrapers of Pudong are lit into the night. And across the city, long lines of trucks, buses and cars clog narrow lanes, broad boulevards, and new-elevated expressways. By 2010, analysts expect some 56 million cars, minivans and sport utility vehicles to be rolling on China’s highways - more than double the number today.

According to the US Energy Department forecasts, by 2020, the country’s demand for oil would nearly double to 11 million barrels a day, natural gas consumption would more than triple to 3.6 trillion cubic foot annually and coal use will grow by 76 percent to 2.4 billion tons a year.

Just a decade ago, China was an exporter of oil, but now it is a net importer. China is currently importing about 40 percent of its crude, as output at its northeastern fields near Daqing and Liaohe are on decline. By 2025, at the current consumption growth rate China would probably import 75 percent of its crude — nearly twice the percentage today — and consume 10.6 percent of the world’s oil, the US Energy Department estimated.

Looking into its growing energy requirements, China is forging close relationships with the GCC. The Chinese foreign minister visited Riyadh in September, stressing on strengthening cooperation with the countries of the region, particularly in the field of energy.