PetroChina’s plant in Dalian, Liaoning province. China is the second largest consumer and importer of crude oil in the world. Photo: Reuters
Edouard Morton, South China Morning Post: What happens to Chinese oil if US-North Korea war erupts?
With tensions between Trump and Kim spiralling, analysis finds a third of seaborne oil trade would be jeopardised by conflict – and China has more at stake than either South Korea or Japan.
More than half of China’s crude oil production and up to a third of global seaborne trade of the commodity could be thrown into jeopardy if a conflict between the United States and North Korea erupted, analysts predict.
It’s a scenario that would cause chaos in the engine room of North Asia, threatening the shutdown of oilfields, refineries and petrochemical production facilities – all key drivers of China’s economy.
Energy industry intelligence firm Wood Mackenzie published the hypothetical analysis on China, Japan and South Korea last week as tensions between the US and North Korea reached new heights.
Read more ....
WNU Editor: Oil shipments to South Korea would be limited to military use. Oil would still be shipped to Japan .... but the insurance rates would be sky-high .... the Japanese government would need to intervene to guarantee that losses would be replaced. Oil would still be shipped to China .... but again ... insurance rates will be high, and I can see Chinese ports that are dependent on traffic going through the Yellow Sea being severely impacted. Bottom line .... the economies of China, South Korea, and Japan will be severely impacted .... and the ripple effect will be global. Expect a long term recession and a few financial shocks.
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