From 1965 to 2005, China's oil consumption grew rapidly at an average annual rate of 8.85%. The proportion of oil consumption in the world's total oil consumption was almost ignored from 0.82%, and it surged to the point where the big oil buyers currently accounted for 8.53%. Affected by factors such as output, China's current oil consumption has largely relied on imports. After my country changed from a net oil exporter to an oil importer in 1993, the central government was worried about the continuous increase in my country's dependence on foreign oil. Wen Rengui was willing to accept Yang Xing's return, because he was interested in his proposal to solve the problem of oil dependence on imports.

After the outbreak of the Iraq War in 2003, many experts predicted that once the war in the Middle East began, international oil prices would fall sharply, and oil prices would rise instead of falling. The reason why China AVIC Oil was in trouble was because of misjudgment based on past experience. The secret report provided by Yang Xing to the country predicted that oil prices would rise all the way, from the current $30 per barrel to around $200. The rising manufacturing costs and inflationary pressure brought to the world will be unprecedented. The country must prepare for the future and be prepared early.

Faced with the unfavorable situation of the continued increase in the dependence of oil on foreign countries, the fluctuations in international oil prices have increased, and the operating risks of domestic related oil companies have become increasingly greater. In order to resolve the risk of imported oil prices and alleviate the increasing energy crisis, the central government made arrangements very early and began to take diversified means such as establishing strategic oil reserves, developing new energy sources and launching oil futures.

The domestic launch of oil futures is to obtain certain international oil pricing power. China has now become the world's second largest energy consumer. Some forecasts show that at the current economic growth rate, China's energy consumption will surpass the United States in the middle of this world and jump to the top in the world. However, although my country's huge oil demand has had a significant impact on the supply and demand pattern of the international oil market, it has little effect in the formulation of international oil prices. Data shows that China's current oil imports account for 2% of the world's oil supply, but the weight affecting oil pricing is less than 0.1%, and it is even worse than that of its close neighbors Indonesia and South Korea.

At present, oil trading is mainly futures, which is different from the three major iron ore manufacturers monopolizing global iron ore transactions. Since oil producers are spread all over the world, even the OPEC, a group of major oil-producing countries in the Middle East, can control oil production less than half of the world's output, and the oil pricing power is not as large as that of the oil crisis in the past. Nowadays, it is often not oil-producing countries that manipulate oil prices, but financial capital composed of speculators, hedge funds and large banks. They are most willing to participate in oil futures trading. This has led to the international oil prices in recent years that often diverge in supply and demand relations, and has attracted more adventurers to join in, turning oil futures into a new paradise of wealth in a big casino-like manner.

There are currently four famous contracts in the world's important crude oil futures market: the lightweight low-sulfur crude oil of the New York Mercantile Exchange (nymex) is the "West Texas Intermediate Oil" futures contract, the high-sulfur crude oil futures contract of the Tokyo Industrial Exchange (tocom), the Brent crude oil futures contract of the London International Petroleum Exchange (ipe), and the Dubai acid crude oil futures contract of the Singapore Exchange (sgx).

In fact, as early as early 1993, China launched its own oil futures trading on the former Shanghai Petroleum Exchange. Later, the former South China Commodity Exchange, the former Beijing Petroleum Exchange, the former Beijing Commodity Exchange and others also successively launched oil futures contracts. By early 1994, the average daily trading volume of the former Shanghai Petroleum Exchange had exceeded the world's third largest energy futures market, the Singapore International Financial Exchange, which had a significant impact at home and abroad, but soon suspended trading due to the implementation of unified oil government pricing. In the next nine years, China's oil futures market was in a blank stage.

The turning point occurred in 2001. my country officially liberalized the price of fuel oil and relied entirely on market forces to regulate its circulation and prices. Fuel oil has become a product with a high degree of marketization among my country's petroleum and petroleum products. According to my country's commitment to the World Trade Organization, starting from January 1, 2004, the import and export quota of fuel oil will be further cancelled and the import automatic license system will be implemented. The fuel oil spot market has basically been in line with the international market, laying a solid market foundation for my country to restore fuel oil futures.

In fact, oil futures are not just crude oil futures, but also include gasoline, diesel and fuel oil. What led to the defeat of AVIC in Singapore was fuel oil trading. Fuel oil is the last product in the refining process. According to the processing process, fuel oil is also called heavy oil. In layman's terms, it is the scraps left after oil refining. However, there is no waste in the eyes of chemists. After a hundred years of efforts of the oil industry, fuel oil is now widely used in power generation, steel, building materials and chemical industries. When oil prices are relatively low, fuel oil was once the largest oil consumed in developed countries. Even after two oil crises, it still occupies a large share of international refined oil.

Among petroleum fuels, fuel oil is mainly affected by factors such as crude oil prices, national policies, refining equipment start-up status, and crude oil processing depth. It is difficult to predict it for a long time, especially its changes around the world. Therefore, like crude oil, a major feature of the fuel oil market is that its price fluctuates very sharply, while emerging market countries, especially BRICS countries, have a rapid economic growth and huge demand for fuel oil. In order to ensure the safety of corporate operations in these countries, fuel oil futures are often used to arbitrage and preserve value.

Fuel oil is the basis for energy supply in many basic industries. Any country requires it to make certain strategic energy reserves, which is a major issue involving the survival of the country and nation. China has imported a huge amount of crude oil in recent years. In order to gain the initiative, it has always wanted to obtain international pricing power, but it has repeatedly hit a wall in this regard, which has put Singapore, a small country, ahead. The world's fuel oil consumer countries are mainly concentrated in East Asia. Singapore and China are the first and second largest fuel oil importers in Asia respectively, but Singapore has the status of international pricing power of fuel oil. Singapore has a very strategic vision and uses its convenience to occupy the world's golden waterway, the Strait of Malacca, making Singapore one of the world's oil trading centers and the most important fuel oil market and distribution center in the world.

In response to this embarrassing situation, in 2001, the Shanghai Futures Exchange established a special oil futures development team and officially submitted a tens of thousands of words to the China Securities Regulatory Commission on the restoration of competition between oil futures and Singapore. The Shanghai Futures Exchange has formulated a three-step oil futures plan for itself, which is to start with fuel oil trading with a higher degree of marketization, cooperate with the adjustment of national oil policies, open more refined oil projects, and finally gradually expand to all oil products.

Faced with the fact that international oil prices have gradually risen in recent years and the increasing number of domestic oil imported, and the growing domestic demand for establishing oil futures to avoid the risk of oil price fluctuations, the central government finally agreed to this plan after careful consideration. Due to the emergence of Yang Xing, the national futures market has led to the joint efforts of the Shanghai United Futures Exchange, which has made fuel oil futures officially listed this year. The "AVIC Oil Affairs" has strengthened this sense of urgency. The fuel oil futures contract launched by the United Futures Exchange is almost fluctuating with the size of the Singapore paper goods market. The intention of wanting to leave is very obvious.

However, compared to gold futures where everyone can open an account to participate in speculation, fuel oil futures are still far away from ordinary people. Those who really start to participate are institutional investors related to oil, so they cannot get a sensational effect similar to when gold futures were launched in a short period of time.

But from an experience point of view, investors who were the first to participate in domestic commodity futures trading can make a lot of profits as long as they are not too greedy. Yang Xing, who is familiar with history, is certainly unwilling to give up this great opportunity. Moreover, the Shanghai Futures Exchange is fundamentally trying to use fuel oil futures as a way stone. As a downstream crude oil product, its pricing is closely related to crude oil prices. The Hong Kong Stock Exchange hopes to use fuel oil futures to open the door to the entire crude oil and refined oil futures, and then grasp the international pricing power of oil.

In the past, China's fuel oil pricing power had to rely on Singapore. Chinese fuel oil importers could only use Singapore's spot assessment prices as reference for import settlement. This practice not only prevented the allocation function of energy resources from being able to perform normally, but also often caused some speculators to deliberately push up spot prices in the Singapore market during the pricing of imported fuel oil in my country, making profits from it. This often causes relevant Chinese companies to bear the risks brought by artificial manipulation of speculators in the futures market in addition to coping with the risk of large fluctuations in the oil prices in the international oil market.

After its listing on the Shanghai Stock Exchange in the past, fuel oil futures soon reached an average daily trading volume of 840,000 tons and a turnover of 1.8 billion yuan. This figure has far exceeded the trading volume of Singapore's paper futures, ranking first in the world's fuel oil futures trading. Through behind-the-scenes operations, Yang Xing has successfully made one of the five oil depots designated for delivery of Shanghai fuel oil futures settle in Hainan. He not only has funds, but also has real oil reserves, and of course he is unwilling to be a spectator when opening oil futures in China.

Once Hainan and Guangdong successfully gain the status of domestic fuel oil trade centers, consumption centers, distribution centers and oil transportation centers with fuel oil futures, according to the quantity division of domestic imported crude oil, the South China region represented by Guangdong and Hainan will also become the oil transportation centers of the global fuel oil market. Yang Xing believes that the oil transportation centers and distribution centers in the Asia-Pacific region will soon gradually move from Singapore to Shanghai as China's oil futures market matures and grows, and China will surely enter the ranks of pricers in the global oil market.
Chapter completed!