Senior officials in Beijing have ordered state-owned energy companies to ensure winter supplies at all costs.
Senior leaders give instructions

According to sources familiar with  Bloomberg, senior officials in the capital Beijing have ordered a series of state-owned energy companies to stock up on sufficient supplies of coal, oil, electricity, etc. for this winter.

The order was issued directly by Vice Premier Han Zheng, who is in charge of overseeing China’s energy sector and industrial production.

The source said Han made the new request at a meeting earlier this week with officials from Beijing’s state wealth management and economic planning agency. The deputy prime minister did not accept the widespread blackout, the source added.

Deputy Prime Minister Han Chinh. (Photo:   Xinhua).

The emergency meeting of Beijing officials shows that China is going through a very serious power shortage crisis. Currently, many provinces and cities have had to limit power supply to the industrial sector, while some residential areas even faced sudden power outages.

In a statement on WeChat last night (September 30), the two state-owned power groups State Power Investment and China Energy Investment reiterated the message of Deputy Prime Minister Ha Chinh and promised to make efforts to ensure the supply of electricity. enough coal and electricity for the coming winter.

“We will do our best to overcome this energy supply crisis,” China’s top coal miner CEIC said in a separate statement.

Energy market turmoil

China’s energy crisis is also causing turmoil in the global commodity market, causing prices of a wide range of commodities from fertilizers to silicon to all jump.

Bjarne Schieldrop, commodities analyst at research firm SEB Research, said the directive from the Beijing government will further make energy markets more volatile.

According to Schiedrop, Beijing’s signal “shows that the market cannot cool down, instead commodity prices may increase even more.” China will go crazy buying, whether it’s a batch of coal or liquefied natural gas (LNG).

In a sign of how unsettled Chinese officials are, Premier Li Keqiang has announced that the government will take all measures to maintain economic growth.

China will ensure the people’s basic livelihood and keep the supply chain and industrial production running smoothly, China National Radio quoted Li Keqiang as saying on September 30. .

Leslie Palti-Guzman, president of consulting firm Gas Vista, said that China’s move “is making energy supply security the focus of public attention”.

“This is bad news for European governments and consumers, who will suffer from higher electricity and gas prices for the rest of the winter as they compete for purchases with China,” she said. Palti-Guzman emphasized.

In today’s trading session (October 1), WTI oil prices extended their gains after wiping out losses in the previous session, and natural gas futures in New York also jumped. On September 30, China’s coal futures jumped to a record high as the country grapples with fuel shortages ahead of a week-long holiday.

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