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Game changer for Beijing? China finds 100 million tonne oilfield in Bohai Sea

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CNOOC revealed earlier in March 2024 that it found a fresh deposit in the South China Sea that holds more than 100 million tonnes of proven oil equivalent

The state-owned oil and gas behemoth, China’s CNOOC Limited, has announced about making a significant oilfield discovery in the Bohai Sea, adding more than 100 million metric tons of proven in-place volume.

According to a statement from the firm, the finding was made at the Qinhuangdao 27-3 oilfield, which is situated in the Bohai Sea’s north-central waters. According to tests, the field can generate roughly 742 barrels of crude oil per day from a single well.

CNOOC revealed earlier in March 2024 that it found a fresh deposit in the South China Sea that holds more than 100 million tonnes of proven oil equivalent.

The announcements coincide with CNOOC’s significant investments in China’s offshore gas and oil reserves, which are part of a larger initiative to counteract the ageing onshore resources’ diminishing output.

With production hitting over 675 million BOE in 2023, the oil and gas giant increased its 2024 production target in January this year by almost 8% to a record 700 million to 720 million barrels of oil equivalent, citing increasing yearly capital spending.

Industrial Production

Even while the property sector’s crisis continues to weigh on the economy and morale, China’s factory output and retail sales in the January–February 2024 quarter exceeded predictions, signalling a strong start for 2024 and providing some respite to policymakers.

The results released add to previous consumer inflation and export figures that were stronger than anticipated, giving Beijing’s chances of meeting the ambitious 5% GDP growth target for 2024 a head start.

China’s activity statistics at the beginning of the year largely stabilised. However, there are still grounds to believe that a portion of the strength might be an anomaly, according to Oxford Economics’ China economist Louise Loo.

In the first two months of 2024, industrial output increased by 7%, according to the latest figures issued by the National Bureau of Statistics. This growth was faster than the 6.8% observed in December 2023 and exceeded predictions of a 5% gain in a Reuters poll of analysts. Additionally, it represented the fastest growth in nearly two years.

Retail sales, a measure of consumption, increased by 5.5%, exceeding the predicted growth of 5.2%, but decreasing from a 7.4% increase in December 2023.

Travel returned in force for the eight-day Lunar New Year vacation in February 2024, bolstering the travel and hospitality industries’ earnings. As a result, the throughput of oil refineries increased by 3% to fulfil the high demand for transportation fuels.

Real Estate Industry

A lengthy crisis in the real estate industry, one of the primary economic pillars, continues to be a source of great anxiety for investors, consumers, and policymakers.

On that front, recently launched figures provided little solace; while decreases in real estate investment narrowed in January and February, they were still well short of stabilising.

The low demand demonstrated the sector’s fragility. Floor area-based property sales had a 20.5% decline from January to February of 2023 compared to a 23% decline in December of 2022.

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