According to China Ministry of Commerce website, Zhejiang Tyloo Energy Co. Ltd. has obtained 1.08 million cubic meters permit for crude oil storage, and Zhoushan Zhongji Petrochemical Co. Ltd. 1.1 million cubic meters. They are the only two private companies which have got crude oil storage licenses so far in China.

Ting Jin, an analyst on crude oil market from Jinyindao Company, expressed durin a interview that, in this case, it shows that Chinese government is gradually releasing the control over the crude oil storage and import areas.

To open the import area, it can improve and perfect the crude oil import channels, and on the other hand it can create conditions for crude oil futures going public.

Ting Jin also said, “ after opening the import area of crude oil in China, it is good for stabilizing oil sources, so as to improve the quality of oil products. Meanwhile, when self-sufficient in crude oil resources, private enterprises will be stronger and more confident, and the national oil market will be more liberalized.

So far, quota system is being implemented on crude oil imports in China. But recently, it is said that a certain governmental department is considering opening crude oil imports to more refinery corporations in addition to those state owned petro giants, with the new increased quota of at least 10million tons expected in 2014.

In recent years, China dependence on foreign crude oil has been increasing and over 50% from the year 2009. The foreign dependence has been 49.1%,52.48%,53.79%,55.11%and 56.44% respectively in the year of 2008, 2009, 2010, 2011, 2012.

Under the background, to relieve control on crude oil import will allow more private enterprises to join the purchase group and to diversify sources of crude oil.

In July of this year, the CPC (Central Committee and State Council) issued a document – A Few Opinions on Promoting the Steady Growth of Import & Export And Adjusting Structure – where it was mentioned that the country needs to gradually expand service import, allow oil processing companies who meet in quality, environmental, security and energy-saving standards to import and use crude oil, optimize industry’s structure and eliminate lagging-behind productivities.

It’s necessary to quicken the step to establish A System on Commercial Crude Oil Reserve by Oil Enterprises and to increase the state regulation and control capability.

Ting Jin also said, opening of crude oil import will not be a short process and it should be a gradual one to start opening the storage area for private players.