As China’s economy continues to expand and modernise, its impact on world energy markets is set to continue growing, especially in the case of oil. The rapid growth of demand for oil, mainly for the transport sector, combined with the limited extent of remaining oil reserves, underpins this seemingly exorable rise in oil imports. China’s government has realised that this pattern of energy consumption and of oil consumption is not sustainable and has embarked on a series of programmes to constrain the growth of energy demand and to reduce the environmental impact of energy use.

This paper provides a brief review of recent government policy initiatives in the wider field of energy conservation and identifies potential obstacles to effective implementation. It then evaluates China’s domestic and international policies for oil production, consumption and sector investments and assesses the likely implications for OPEC.