1 00:00:02,720 --> 00:00:16,560 Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News. 2 00:00:18,040 --> 00:00:21,759 Speaker 2: Hello and welcome to another episode of the Odd Lots Podcast. 3 00:00:21,840 --> 00:00:24,200 Speaker 3: I'm Joe Wisenthal and I'm Tracy Alloway. 4 00:00:24,600 --> 00:00:27,920 Speaker 2: So, Tracy, we're recording this one pm March fourth, twenty 5 00:00:28,080 --> 00:00:29,320 Speaker 2: twenty six, and so. 6 00:00:29,320 --> 00:00:31,000 Speaker 3: One of those days where you have to nail the 7 00:00:31,040 --> 00:00:33,440 Speaker 3: hour and the minute because who knows what's going to happen. 8 00:00:33,640 --> 00:00:36,360 Speaker 2: Absolutely, of course, we are in the midst of a 9 00:00:36,440 --> 00:00:39,319 Speaker 2: war with the rent that started this past weekend, and 10 00:00:39,400 --> 00:00:43,360 Speaker 2: it's been an extraordinary week in markets, massive surge in 11 00:00:43,400 --> 00:00:47,080 Speaker 2: the price of oil, all kinds of concerns about the 12 00:00:47,120 --> 00:00:50,159 Speaker 2: sheer logistics of getting oil other as well as other 13 00:00:50,200 --> 00:00:53,360 Speaker 2: commodities out of that region. Who's going to be affected? 14 00:00:54,160 --> 00:00:57,120 Speaker 2: The ramifications are just global for obvious reasons. 15 00:00:57,240 --> 00:01:00,279 Speaker 3: Yeah, there's clearly a lot to talk about. There are 16 00:01:00,320 --> 00:01:03,240 Speaker 3: some interesting angles in particular that you and I have 17 00:01:03,280 --> 00:01:05,520 Speaker 3: been discussing, and we're going to try to hit all 18 00:01:05,560 --> 00:01:08,319 Speaker 3: of those individually in a lot of different episodes that 19 00:01:08,400 --> 00:01:11,960 Speaker 3: are coming up. But for this particular episode, we want 20 00:01:12,000 --> 00:01:15,319 Speaker 3: to talk about something that you know, obviously the US 21 00:01:15,840 --> 00:01:19,440 Speaker 3: Europe have kind of been i would say the main 22 00:01:19,680 --> 00:01:22,400 Speaker 3: subject of a lot of the hand ringing or the 23 00:01:22,440 --> 00:01:25,600 Speaker 3: focus at the moment. So Europe, we know, has had 24 00:01:25,600 --> 00:01:29,160 Speaker 3: to grapple with higher energy costs for a while, and clearly, 25 00:01:29,360 --> 00:01:31,959 Speaker 3: you know, all this chaos in the Middle East is 26 00:01:31,959 --> 00:01:34,679 Speaker 3: not going to be good for that. But one thing 27 00:01:34,720 --> 00:01:37,160 Speaker 3: that hasn't gotten as much attention is what this actually 28 00:01:37,240 --> 00:01:40,960 Speaker 3: means for China, which is a huge, huge purchaser of 29 00:01:41,040 --> 00:01:42,319 Speaker 3: oil from the Middle East. 30 00:01:42,560 --> 00:01:45,520 Speaker 2: Right this is really important. So obviously in the US 31 00:01:45,600 --> 00:01:48,680 Speaker 2: we're swimming with oil or an oil exporter. This could 32 00:01:48,680 --> 00:01:51,320 Speaker 2: be very good also for our gas exports to Europe. 33 00:01:51,400 --> 00:01:54,000 Speaker 2: I mean, already we've seen this big increase in gas 34 00:01:54,040 --> 00:01:56,760 Speaker 2: exports from the US to Europe, particularly just in the 35 00:01:56,840 --> 00:01:59,960 Speaker 2: wake of the ongoing war in Ukraine. So this could 36 00:02:00,040 --> 00:02:02,920 Speaker 2: create further opportunities. But for all the countries that are 37 00:02:02,960 --> 00:02:07,120 Speaker 2: you know, major importers, and China being one is obviously 38 00:02:07,440 --> 00:02:08,880 Speaker 2: a very different dimension for them. 39 00:02:09,000 --> 00:02:12,560 Speaker 3: Absolutely. Also, can I just say that this particular topic 40 00:02:12,720 --> 00:02:16,440 Speaker 3: is finally, finally an opportunity to touch on teapot refiners 41 00:02:16,480 --> 00:02:18,639 Speaker 3: in China, which I always wanted to do an episode 42 00:02:18,639 --> 00:02:21,079 Speaker 3: on and for some reason we never got to it. 43 00:02:21,200 --> 00:02:22,960 Speaker 3: But but now's our chance. 44 00:02:23,280 --> 00:02:25,440 Speaker 2: I will learn what a tea. I've known at times 45 00:02:25,440 --> 00:02:26,600 Speaker 2: what a teapot refiner is. 46 00:02:26,600 --> 00:02:29,080 Speaker 3: Wait, what's your impression if if someone says teapop refinery, 47 00:02:29,080 --> 00:02:29,600 Speaker 3: what do you think. 48 00:02:29,840 --> 00:02:31,720 Speaker 2: Don't put me on the spotlight. I just imagine a 49 00:02:31,720 --> 00:02:32,440 Speaker 2: little refinery. 50 00:02:32,520 --> 00:02:35,040 Speaker 3: Yeah, I mean that's it basically, all right, that was 51 00:02:35,040 --> 00:02:37,720 Speaker 3: a good guest. Yes, I just think it has a 52 00:02:37,720 --> 00:02:39,320 Speaker 3: cute name, and so I like thinking about it. 53 00:02:40,240 --> 00:02:42,480 Speaker 2: Anyway, I'm very excited to say, we really do have 54 00:02:42,600 --> 00:02:44,840 Speaker 2: the perfect guest today to sort of talk about the 55 00:02:44,919 --> 00:02:48,320 Speaker 2: energy dimension from some angles that have that deserve and 56 00:02:48,360 --> 00:02:51,519 Speaker 2: need more exploration. In this precise moment, we're going to 57 00:02:51,520 --> 00:02:54,240 Speaker 2: be speaking with Erica Downs. She's a senior research scholar 58 00:02:54,520 --> 00:02:58,560 Speaker 2: at Columbia University's Center on Global Energy Policy and an 59 00:02:58,639 --> 00:03:00,960 Speaker 2: expert truly in this field. Thank you so much for 60 00:03:01,000 --> 00:03:01,959 Speaker 2: coming on odline. 61 00:03:02,440 --> 00:03:04,480 Speaker 4: Thank you so much for having me just. 62 00:03:04,440 --> 00:03:06,120 Speaker 2: For the sake of our audience. Why do you give 63 00:03:06,200 --> 00:03:08,840 Speaker 2: us the sort of brief overview of your work? Tell 64 00:03:08,919 --> 00:03:10,800 Speaker 2: us a little bit about what you do in your 65 00:03:10,840 --> 00:03:11,880 Speaker 2: general field of study. 66 00:03:12,600 --> 00:03:18,120 Speaker 4: So my research focus is primarily on the geopolitics of energy, 67 00:03:18,520 --> 00:03:22,400 Speaker 4: and so I've been kept busy recently looking at China's 68 00:03:22,480 --> 00:03:26,520 Speaker 4: energy relationships with Russia, with Venezuela, and of course this 69 00:03:26,600 --> 00:03:27,040 Speaker 4: week with. 70 00:03:27,120 --> 00:03:31,240 Speaker 3: Ran So why don't you sum up I guess China's 71 00:03:31,280 --> 00:03:34,639 Speaker 3: relationship with energy at the moment. Then. The only thing 72 00:03:34,680 --> 00:03:37,320 Speaker 3: I know in recent times that sort of hit the 73 00:03:37,320 --> 00:03:40,720 Speaker 3: headlines is that China has been importing an enormous amount 74 00:03:40,760 --> 00:03:45,320 Speaker 3: of oil, which both suggests that it needs oil and 75 00:03:45,360 --> 00:03:47,800 Speaker 3: it's an important thing for its economy to work, but 76 00:03:47,960 --> 00:03:50,560 Speaker 3: also that you know, maybe in the face of tider 77 00:03:50,600 --> 00:03:52,760 Speaker 3: supply coming from the Middle East, it has something of 78 00:03:52,800 --> 00:03:53,280 Speaker 3: a cushion. 79 00:03:54,680 --> 00:03:57,680 Speaker 4: So yes, China has been putting a lot of oil 80 00:03:57,800 --> 00:04:03,240 Speaker 4: into storage. They kick started Strategic Petroleum Reserve over twenty 81 00:04:03,360 --> 00:04:06,400 Speaker 4: years ago and have been building it up precisely to 82 00:04:06,560 --> 00:04:11,120 Speaker 4: have in moments like the one that we are in now. Now, China, 83 00:04:11,160 --> 00:04:15,520 Speaker 4: as you mentioned, is a big importer of oil. About 84 00:04:15,520 --> 00:04:19,040 Speaker 4: half the oil that China imports comes from the Middle East. 85 00:04:19,320 --> 00:04:22,599 Speaker 4: Most of those Middle East oil supplies passed through the 86 00:04:22,720 --> 00:04:25,240 Speaker 4: street of Horrmus, which is now closed. 87 00:04:26,160 --> 00:04:28,240 Speaker 2: Talk to us a little bit about the volumes here 88 00:04:28,400 --> 00:04:32,599 Speaker 2: that we're talking about. Tracy mentioned that obviously they're importing 89 00:04:33,320 --> 00:04:36,000 Speaker 2: quite a bit and much of it keeping in storage, 90 00:04:36,240 --> 00:04:39,440 Speaker 2: like Okay, we're talking about Iran or something. How crucial 91 00:04:39,640 --> 00:04:42,400 Speaker 2: is that relationship? What do we know about its volume? 92 00:04:42,640 --> 00:04:45,560 Speaker 2: What do we know about pricing? Tell us some more 93 00:04:45,640 --> 00:04:48,919 Speaker 2: details about this particular bilateral trading relationship. 94 00:04:49,800 --> 00:04:55,279 Speaker 4: Sure, So, last year China imported eleven point six million 95 00:04:55,360 --> 00:04:59,560 Speaker 4: barrels per day, About one point four million barrels per 96 00:04:59,640 --> 00:05:04,599 Speaker 4: day came from Iran, so that accounted for about twelve 97 00:05:04,680 --> 00:05:10,680 Speaker 4: percent of China's crude oil imports. Now the main buyers 98 00:05:10,720 --> 00:05:15,840 Speaker 4: of Iranian oil in China are the teapot refineries. I've 99 00:05:15,839 --> 00:05:19,159 Speaker 4: been following the teapot refineries for a long time and 100 00:05:19,200 --> 00:05:21,280 Speaker 4: I love to talk about them, So Joe could be 101 00:05:21,360 --> 00:05:25,240 Speaker 4: very happy to hear you speak about them in your introduction. Yeah, 102 00:05:25,240 --> 00:05:29,800 Speaker 4: and so the teapots are small, independent refineries. Many of 103 00:05:29,800 --> 00:05:33,960 Speaker 4: them are clustered in Shandong Province. They are not as 104 00:05:34,080 --> 00:05:38,760 Speaker 4: big or sophisticated as the refineries operated by China's national 105 00:05:38,800 --> 00:05:44,279 Speaker 4: oil companies or the new integrated refining and petrochemical projects. 106 00:05:44,360 --> 00:05:47,560 Speaker 4: These are world scale projects that have popped up in 107 00:05:47,720 --> 00:05:50,600 Speaker 4: China over the past few years. So the teapots are 108 00:05:50,680 --> 00:05:56,960 Speaker 4: much smaller, less sophisticated, and they rely on the discounts 109 00:05:57,040 --> 00:06:01,720 Speaker 4: they can receive on sanctioned cruds to boost their bottom lines, 110 00:06:02,040 --> 00:06:05,440 Speaker 4: and in some cases they probably depend on these crews 111 00:06:05,440 --> 00:06:08,880 Speaker 4: for their survival. So they're the main buyers of Irani 112 00:06:08,920 --> 00:06:12,400 Speaker 4: and creud in China. The national oil companies that were 113 00:06:12,440 --> 00:06:15,400 Speaker 4: you know lifting you know, all of Iranian's crewed to 114 00:06:15,440 --> 00:06:19,280 Speaker 4: take back to China ten fifteen years ago, are completely 115 00:06:19,360 --> 00:06:23,200 Speaker 4: out of the Iran oil trading business because of concerns 116 00:06:23,200 --> 00:06:26,040 Speaker 4: about US sanctions. And just to bring this back to 117 00:06:26,080 --> 00:06:28,680 Speaker 4: the teapots, you know, the reason why they are buying 118 00:06:29,080 --> 00:06:32,719 Speaker 4: and the national oil companies China's national oil companies aren't 119 00:06:33,080 --> 00:06:37,360 Speaker 4: is because the teapots are more risk tolerant. And what 120 00:06:37,400 --> 00:06:40,280 Speaker 4: I mean by that is that the national oil companies 121 00:06:40,360 --> 00:06:44,520 Speaker 4: have a vested interest in maintaining access to the US 122 00:06:44,560 --> 00:06:47,719 Speaker 4: dollar financial system. You know, these are global companies with 123 00:06:47,839 --> 00:06:51,839 Speaker 4: global operations. They don't want to lose that access. Whereas 124 00:06:51,839 --> 00:06:54,360 Speaker 4: if you look at the teapots who are still buying 125 00:06:54,440 --> 00:06:59,080 Speaker 4: Iranian crude today, I suspect that they have little or no, 126 00:06:59,560 --> 00:07:03,680 Speaker 4: you know, interest in maintaining access to the US dollar 127 00:07:03,760 --> 00:07:07,800 Speaker 4: financial system. Sure, they'd prefer not to be sanctioned, but 128 00:07:08,560 --> 00:07:12,080 Speaker 4: it sanctions being sanctioned wouldn't be catastrophic for them in 129 00:07:12,120 --> 00:07:15,320 Speaker 4: the way it might be for Sinopack or China National 130 00:07:15,320 --> 00:07:19,400 Speaker 4: Petroleum Corporation. And so it's this risk tolerance as well 131 00:07:19,440 --> 00:07:23,520 Speaker 4: as this pursuit of discounted barrels that has made teapots 132 00:07:23,640 --> 00:07:27,320 Speaker 4: the biggest importers of Iranian crude in China. 133 00:07:27,400 --> 00:07:29,440 Speaker 3: So I don't mean to go on too big of 134 00:07:29,480 --> 00:07:33,680 Speaker 3: a teapot tangent. How's that for alliteration? Thank you? But 135 00:07:34,720 --> 00:07:36,560 Speaker 3: how did we end up with this situation where we 136 00:07:36,640 --> 00:07:40,720 Speaker 3: have these national refining giants in China, which I assume 137 00:07:40,840 --> 00:07:44,280 Speaker 3: you know, enjoy support from the state and they enjoy 138 00:07:44,360 --> 00:07:47,920 Speaker 3: all the benefits of scale, and then you have these 139 00:07:48,000 --> 00:07:51,760 Speaker 3: tiny or smaller refiners, independent refiners that have sort of 140 00:07:51,800 --> 00:07:54,320 Speaker 3: cropped up. How did that system actually begin? 141 00:07:56,120 --> 00:08:00,160 Speaker 4: Yeah, so sure, happy to provide some background. So the 142 00:08:00,160 --> 00:08:04,640 Speaker 4: teapot refineries, which are actually called local refineries in China 143 00:08:05,120 --> 00:08:08,680 Speaker 4: originated They grew up in China in northeastern China to 144 00:08:09,320 --> 00:08:13,600 Speaker 4: process crude from the Shunli oil field, you know, which 145 00:08:13,720 --> 00:08:17,320 Speaker 4: historically was one of China's backbone oil fields. And for 146 00:08:17,440 --> 00:08:20,520 Speaker 4: most of their existence, you know, these teapots, you know, 147 00:08:20,880 --> 00:08:27,120 Speaker 4: did not have the right to import and process imported crude. 148 00:08:27,400 --> 00:08:31,120 Speaker 4: And this all changed back in twenty fifteen when the 149 00:08:31,200 --> 00:08:34,320 Speaker 4: Chinese government you know, said that teapots who met certain 150 00:08:34,440 --> 00:08:41,319 Speaker 4: requirements would be granted licenses to purchase and process imported crude. 151 00:08:41,640 --> 00:08:44,760 Speaker 4: And the criteria that the teapots had to meet, you know, 152 00:08:44,880 --> 00:08:46,640 Speaker 4: was were things such as, you know, sort of getting 153 00:08:46,720 --> 00:08:52,080 Speaker 4: rid of highly polluting crude, distallation units, building natural gas storage, 154 00:08:52,559 --> 00:08:55,520 Speaker 4: believe it or not. And so, you know, teapots that 155 00:08:55,559 --> 00:08:58,600 Speaker 4: met these requirements could you know, apply for licenses, and 156 00:08:58,640 --> 00:09:01,280 Speaker 4: they get a license, and they given a quota, and 157 00:09:01,360 --> 00:09:05,440 Speaker 4: they could use that quota to purchase crude from outside 158 00:09:05,440 --> 00:09:09,160 Speaker 4: of China's borders. And when I first started looking at 159 00:09:09,160 --> 00:09:11,800 Speaker 4: the teapots, you know, around the time that they got 160 00:09:11,800 --> 00:09:17,439 Speaker 4: the permission to import crude, they had a pretty diverse 161 00:09:17,960 --> 00:09:26,120 Speaker 4: slate of suppliers. But as sanctions on countries such as Iran, Russia, 162 00:09:26,280 --> 00:09:30,480 Speaker 4: you know, Venezuela titans and discounts were on offer to 163 00:09:30,679 --> 00:09:33,280 Speaker 4: entice buyers to take these barrels that a lot of 164 00:09:33,320 --> 00:09:37,360 Speaker 4: other importers were consuming, the teapot stepped into the void. 165 00:09:38,520 --> 00:09:41,520 Speaker 2: This is already fascinating. I've already learned a lot from this. 166 00:09:41,920 --> 00:09:43,480 Speaker 2: Do we have a sense of, like how big are 167 00:09:43,520 --> 00:09:47,640 Speaker 2: these discounts? So intuitively, okay, a country gets sanctioned and 168 00:09:47,679 --> 00:09:49,880 Speaker 2: then a bunch of buyers and that makes a lot 169 00:09:49,880 --> 00:09:51,960 Speaker 2: of sense don't want to deal with it or don't 170 00:09:51,960 --> 00:09:56,400 Speaker 2: want to risk getting sanctioned themselves. So when Iran, by 171 00:09:56,480 --> 00:09:59,640 Speaker 2: dint of sanctions, essentially forced to sell a significant amount 172 00:09:59,679 --> 00:10:02,400 Speaker 2: of or oil to these teapots, do we have a 173 00:10:02,440 --> 00:10:06,320 Speaker 2: sense of, like what the pricing is on these deals 174 00:10:06,440 --> 00:10:10,719 Speaker 2: relative to overall oil prices. 175 00:10:10,800 --> 00:10:16,719 Speaker 4: So industry press will report, you know, the discounts available, 176 00:10:17,080 --> 00:10:22,000 Speaker 4: which change over time, and the discounts are usually reported 177 00:10:22,080 --> 00:10:24,320 Speaker 4: as you know, x number of dollars lower than the 178 00:10:24,320 --> 00:10:28,640 Speaker 4: price of rent. So the discounts that China's teapot refineries 179 00:10:28,760 --> 00:10:32,120 Speaker 4: receive on sanctioned barrels are certainly attractive enough to make 180 00:10:32,160 --> 00:10:36,280 Speaker 4: them seek them out. Now, these discounts change over time, 181 00:10:36,440 --> 00:10:39,640 Speaker 4: you know, they're often reported in industry press as you 182 00:10:39,640 --> 00:10:42,120 Speaker 4: know a certain number of dollars you know, cheaper than 183 00:10:42,559 --> 00:10:45,760 Speaker 4: the price of reent crude. And just to give you 184 00:10:46,040 --> 00:10:49,400 Speaker 4: a sense of how important these are to the teapots, 185 00:10:49,559 --> 00:10:52,040 Speaker 4: it Reiters ran a piece I believe back in twenty 186 00:10:52,080 --> 00:10:55,200 Speaker 4: twenty three where they said they had calculated that China 187 00:10:55,240 --> 00:10:59,120 Speaker 4: had saved ten billion dollars on crude oil imports by 188 00:10:59,240 --> 00:11:01,160 Speaker 4: importing these sanction cruits. 189 00:11:01,400 --> 00:11:04,840 Speaker 3: Okay, so you can imagine that in the current scenario 190 00:11:05,200 --> 00:11:09,320 Speaker 3: where you have these teapot refineries that are benefiting from 191 00:11:09,400 --> 00:11:12,480 Speaker 3: the discount between sanctioned and non sanction oil, they're going 192 00:11:12,559 --> 00:11:16,760 Speaker 3: to be hit by I guess less oil in the 193 00:11:16,800 --> 00:11:20,640 Speaker 3: system in general, but I mean Russia still exists, Russian 194 00:11:20,640 --> 00:11:23,880 Speaker 3: oil is still out there. Could you see a scenario 195 00:11:24,120 --> 00:11:27,520 Speaker 3: where they just start importing more Russian oil to offset 196 00:11:27,640 --> 00:11:29,600 Speaker 3: some of the supply that's lost in the Middle East. 197 00:11:31,000 --> 00:11:33,960 Speaker 4: Yeah, I do think that is likely. And I will 198 00:11:34,000 --> 00:11:36,760 Speaker 4: say this is actually a tough time for the teapots 199 00:11:36,800 --> 00:11:43,640 Speaker 4: because last month the Trump's removal of Venezuelan President Maduro 200 00:11:43,880 --> 00:11:47,120 Speaker 4: from office and the US taking control of the marketing 201 00:11:47,200 --> 00:11:50,360 Speaker 4: of some of Venezuela's crude sort of raise questions about 202 00:11:50,360 --> 00:11:53,720 Speaker 4: how much oil, how much Venezuelan oil would China still 203 00:11:53,760 --> 00:11:56,440 Speaker 4: be able to import and at what price, And in 204 00:11:56,679 --> 00:12:02,080 Speaker 4: anticipation of a potential shortfall in the or Venezuelan oil imports, 205 00:12:02,160 --> 00:12:06,960 Speaker 4: the teapots turned to Iran and specifically to purchasing rani 206 00:12:06,960 --> 00:12:11,080 Speaker 4: and heavy crude, which is, you know, a decent substitute 207 00:12:11,120 --> 00:12:13,760 Speaker 4: and you know, certainly could be obtained at a discount. 208 00:12:13,920 --> 00:12:16,000 Speaker 4: But now, of course, you know, with the war in 209 00:12:16,040 --> 00:12:19,360 Speaker 4: the Middle East, this is raising questions about the teapots 210 00:12:19,360 --> 00:12:22,160 Speaker 4: supply of Iranian oil. The good news, I guess for 211 00:12:22,320 --> 00:12:25,040 Speaker 4: China as a whole is that they are sitting on 212 00:12:25,320 --> 00:12:32,320 Speaker 4: substantial strategic and commercial oil stockpiles that provide one hundred 213 00:12:32,480 --> 00:12:37,160 Speaker 4: and twenty days of China's net crude oil imports at 214 00:12:37,160 --> 00:12:39,240 Speaker 4: the twenty twenty five level. So you know what that 215 00:12:39,280 --> 00:12:41,360 Speaker 4: means is that if all of you know, China was 216 00:12:41,520 --> 00:12:45,200 Speaker 4: unable to import any oil at all, which obviously isn't 217 00:12:45,240 --> 00:12:48,000 Speaker 4: going to happen, they could you know, rely on their 218 00:12:48,040 --> 00:12:52,000 Speaker 4: stockpiles for four months of crude oil imports. And so 219 00:12:52,120 --> 00:12:54,400 Speaker 4: if you look at the sort of Iranian crude and 220 00:12:54,480 --> 00:12:56,920 Speaker 4: you know, perhaps other flows that might be disrupted by 221 00:12:56,920 --> 00:12:59,160 Speaker 4: the closure of the Street of Hormos, you know, they're 222 00:12:59,240 --> 00:13:03,320 Speaker 4: sitting in a pretty good position. Also, there is you 223 00:13:03,360 --> 00:13:07,920 Speaker 4: know a good amount of Iranian and Russian crewed in 224 00:13:08,200 --> 00:13:12,560 Speaker 4: floating storage in Asia off the coast of China and Malaysia. 225 00:13:12,720 --> 00:13:15,960 Speaker 4: And you know this had been building up before the 226 00:13:16,080 --> 00:13:20,680 Speaker 4: US and Israel launched their strikes on Iran. And there 227 00:13:20,800 --> 00:13:25,559 Speaker 4: is also Iranian oil sitting in bonded storage in Chinese 228 00:13:25,760 --> 00:13:27,960 Speaker 4: courts which could be tapped into. 229 00:13:44,000 --> 00:13:46,800 Speaker 2: You know, you mentioned the significance of the you know, 230 00:13:46,840 --> 00:13:51,520 Speaker 2: we're talking about the Iran China trading relationship. How significant 231 00:13:51,600 --> 00:13:54,320 Speaker 2: was Venezuela in this picture? And what do we know 232 00:13:54,360 --> 00:13:57,000 Speaker 2: about the picture now because I think there's still Venezuelan 233 00:13:57,080 --> 00:14:00,120 Speaker 2: oil now going to China right now, But how well 234 00:14:00,320 --> 00:14:03,480 Speaker 2: talk to us about the significance of that piece of 235 00:14:03,520 --> 00:14:03,960 Speaker 2: the puzzle. 236 00:14:04,360 --> 00:14:10,680 Speaker 4: Yeah, so Venezuela is a smaller crude oil supplier to 237 00:14:10,960 --> 00:14:16,000 Speaker 4: China than Iran. Last year of Venezuela, you know, supplied 238 00:14:16,600 --> 00:14:20,040 Speaker 4: you know, around four hundred thousand viarrels per day of 239 00:14:20,080 --> 00:14:22,640 Speaker 4: crude oil to China. So you're just looking at you know, 240 00:14:22,680 --> 00:14:25,760 Speaker 4: a few, very very small share the three four percent 241 00:14:25,880 --> 00:14:30,480 Speaker 4: of China's total crude oil imports last year. However, you know, 242 00:14:30,600 --> 00:14:34,960 Speaker 4: virtually all of that oil was going to the teapot refineries. 243 00:14:35,200 --> 00:14:37,280 Speaker 4: So while you can say, oh, China is not going 244 00:14:37,320 --> 00:14:39,560 Speaker 4: to be hit too hard, if you know, it loses 245 00:14:39,760 --> 00:14:42,240 Speaker 4: four hundred thousand barrels per day of crude oil imports 246 00:14:42,240 --> 00:14:45,440 Speaker 4: from Venezuela. It does sort of make life more difficult 247 00:14:45,440 --> 00:14:50,560 Speaker 4: for the teapot refineries. Now, Secretary Right did say a 248 00:14:50,600 --> 00:14:53,520 Speaker 4: couple of weeks ago that you know, the US had 249 00:14:53,600 --> 00:14:56,840 Speaker 4: sold some Venezuelan crewe to China. I don't know who 250 00:14:56,880 --> 00:14:59,400 Speaker 4: the buyers are. And of course for the teapots, you know, 251 00:14:59,520 --> 00:15:01,720 Speaker 4: prices also an issue. I mean, yes, they would like 252 00:15:01,800 --> 00:15:04,680 Speaker 4: to you know, continue to import those Venezuelan barrels because 253 00:15:04,720 --> 00:15:07,600 Speaker 4: they're used to processing you know, that type of crude. 254 00:15:07,920 --> 00:15:12,560 Speaker 4: But the current situation means that they might be even 255 00:15:12,600 --> 00:15:14,840 Speaker 4: if they can still you know, buy a fair amount 256 00:15:14,920 --> 00:15:17,680 Speaker 4: of Venezuela and oil you know that's being marketed by 257 00:15:17,720 --> 00:15:19,880 Speaker 4: the US, you know, I think a big question for 258 00:15:19,960 --> 00:15:21,760 Speaker 4: them is at what price? 259 00:15:22,800 --> 00:15:25,880 Speaker 3: Can we go back to China's Strategic Petroleum Reserve for 260 00:15:25,920 --> 00:15:29,680 Speaker 3: a second, because I feel like the US reserve was 261 00:15:29,680 --> 00:15:32,320 Speaker 3: such a big talking point during the Biden administration and 262 00:15:32,360 --> 00:15:36,320 Speaker 3: it kind of, you know, soared into our collective consciousness 263 00:15:36,520 --> 00:15:39,560 Speaker 3: when we think about China's spr What are the actual 264 00:15:40,200 --> 00:15:43,960 Speaker 3: goals there of the Chinese state? Why did they establish this, 265 00:15:44,080 --> 00:15:46,360 Speaker 3: what are they thinking about? And then also what do 266 00:15:46,440 --> 00:15:47,840 Speaker 3: we actually know about it? 267 00:15:49,000 --> 00:15:54,800 Speaker 4: Yeah, so the main reason China established its strategic oil 268 00:15:54,880 --> 00:16:00,200 Speaker 4: reserve is because China is a major importer of oil. 269 00:16:00,440 --> 00:16:05,720 Speaker 4: China switched to a net importer of oil in nineteen 270 00:16:05,840 --> 00:16:11,440 Speaker 4: ninety three, and as its reliance on imported crewed group 271 00:16:11,840 --> 00:16:17,360 Speaker 4: there were real concerns about supply security in China, and 272 00:16:17,440 --> 00:16:21,920 Speaker 4: so building a strategic petroleum reserve, you know, is one 273 00:16:21,920 --> 00:16:24,560 Speaker 4: of the things that they did, you know, to make 274 00:16:24,600 --> 00:16:27,240 Speaker 4: sure that they are in a good position, you know, 275 00:16:27,360 --> 00:16:32,720 Speaker 4: to deal with unexpected disruptions to their oil supplies. Now, 276 00:16:32,760 --> 00:16:34,640 Speaker 4: one thing, as I mentioned earlier, I've been looking at 277 00:16:34,640 --> 00:16:37,640 Speaker 4: this issue for quite some time, and I recall you know, 278 00:16:37,680 --> 00:16:40,000 Speaker 4: going back, you know, over twenty years ago. You know, 279 00:16:40,080 --> 00:16:42,960 Speaker 4: so there we are discussions at China about do we 280 00:16:43,040 --> 00:16:46,080 Speaker 4: need this, can we afford it? You know, how big 281 00:16:46,320 --> 00:16:50,240 Speaker 4: a stockpile? You know, do we want to invest in building? 282 00:16:50,760 --> 00:16:53,960 Speaker 4: And you know, as you may know, for states that 283 00:16:54,120 --> 00:16:57,600 Speaker 4: are members of the International Energy Agency, at which China 284 00:16:57,680 --> 00:17:00,960 Speaker 4: is not, but the International Energy Agency you know requires 285 00:17:01,120 --> 00:17:04,479 Speaker 4: members still hold you know, stock piles you know equal 286 00:17:04,520 --> 00:17:07,600 Speaker 4: to you know, ninety days of net oil import coverage, 287 00:17:07,600 --> 00:17:09,600 Speaker 4: you know, and so that's the benchmark that has been 288 00:17:09,680 --> 00:17:12,640 Speaker 4: used and a lot of Chinese discussions about its SPR 289 00:17:12,960 --> 00:17:16,159 Speaker 4: over the years. And you know, again I remember, you know, 290 00:17:16,240 --> 00:17:19,280 Speaker 4: going back fifteen twenty years ago, and you did have 291 00:17:19,359 --> 00:17:22,399 Speaker 4: voices in China that were saying, we already import a 292 00:17:22,400 --> 00:17:25,920 Speaker 4: lot of oil, Our imports are going to continue to grow. 293 00:17:25,960 --> 00:17:29,120 Speaker 4: Can we really afford to build ninety days of net 294 00:17:29,160 --> 00:17:32,000 Speaker 4: oil import coverage? But if you fast forward to today 295 00:17:32,080 --> 00:17:34,760 Speaker 4: and you look at the different estimates out there about 296 00:17:34,800 --> 00:17:38,240 Speaker 4: how much oil is sitting in storage in China, you know, 297 00:17:38,320 --> 00:17:42,200 Speaker 4: to include both strategic stockpiles as well as commercial stock 298 00:17:42,240 --> 00:17:46,639 Speaker 4: piles held by oil companies, China holds more than ninety 299 00:17:46,760 --> 00:17:50,800 Speaker 4: days of net oil import coverage. And so looking at 300 00:17:50,840 --> 00:17:54,919 Speaker 4: the disruptions, looking at the geopolitical sort of upheavals in 301 00:17:55,359 --> 00:17:58,719 Speaker 4: oil markets, you know, just this calendar year with the 302 00:17:58,880 --> 00:18:02,280 Speaker 4: US actions in venezuel and now Iran, the fact that 303 00:18:02,359 --> 00:18:06,560 Speaker 4: China is sitting on these substantial stockpiles, you know, has 304 00:18:06,680 --> 00:18:10,560 Speaker 4: to be a source of peace of mind and sort 305 00:18:10,560 --> 00:18:13,399 Speaker 4: of a vindication for undertaking this project. 306 00:18:13,480 --> 00:18:17,000 Speaker 2: Yeah, Tracy mentioned obviously all the fights about the SPR 307 00:18:17,040 --> 00:18:19,640 Speaker 2: and the US under the Biden administration. And it's kind 308 00:18:19,640 --> 00:18:22,920 Speaker 2: of weird because, like, you know, there's some question why 309 00:18:23,000 --> 00:18:25,640 Speaker 2: is you know, the US is a massive exporter producer 310 00:18:25,680 --> 00:18:27,520 Speaker 2: of oil now in a way that wasn't the case 311 00:18:27,560 --> 00:18:30,639 Speaker 2: twenty years ago or thirty years ago or at the time, 312 00:18:31,040 --> 00:18:33,600 Speaker 2: certainly at the time that the SPR was first conceived. 313 00:18:34,160 --> 00:18:36,520 Speaker 2: So it's a little unclear what the point of an 314 00:18:36,600 --> 00:18:39,000 Speaker 2: SPR is. And so I'm not surprised that it's sort 315 00:18:39,000 --> 00:18:41,679 Speaker 2: of used to lower the price of gasoline for consumers 316 00:18:41,760 --> 00:18:45,439 Speaker 2: in a time of high inflation and so forth. In China, 317 00:18:45,600 --> 00:18:49,000 Speaker 2: where you know, the automobile, you know, they're switching rapidly 318 00:18:49,119 --> 00:18:51,919 Speaker 2: to EVS. Oil is not going to be as important 319 00:18:52,119 --> 00:18:55,080 Speaker 2: for that, and it's going to continue to be less 320 00:18:55,080 --> 00:19:00,359 Speaker 2: important over time. How much is it about prosecuting war 321 00:19:00,560 --> 00:19:04,000 Speaker 2: at some point and the prospect that they would completely 322 00:19:04,040 --> 00:19:07,639 Speaker 2: get shut off from oil imports in the event of aggression, 323 00:19:07,800 --> 00:19:10,280 Speaker 2: and how much is that really what it's about having 324 00:19:10,359 --> 00:19:13,800 Speaker 2: the resources to fight a war if and when that 325 00:19:13,880 --> 00:19:14,720 Speaker 2: time comes. 326 00:19:15,400 --> 00:19:19,440 Speaker 4: Yeah, No, I absolutely think that is part of it. 327 00:19:19,640 --> 00:19:23,080 Speaker 4: Ever since China switched to being a net importer of oil, 328 00:19:23,320 --> 00:19:27,520 Speaker 4: there have been real concerns about the vulnerability of its 329 00:19:27,600 --> 00:19:32,480 Speaker 4: oil imports and specifically its seaborne oil imports by various 330 00:19:32,520 --> 00:19:36,440 Speaker 4: modern navies, notably that of the United States. That's why 331 00:19:36,480 --> 00:19:40,639 Speaker 4: we saw China build these pipelines. Did they deliver oil 332 00:19:40,760 --> 00:19:46,000 Speaker 4: overland from Russia and from Kazakhstan. And so given those concerns, 333 00:19:46,320 --> 00:19:49,119 Speaker 4: given you know, those fears that in the event of 334 00:19:49,160 --> 00:19:52,320 Speaker 4: a conflict that it's China, you know, in the United States, 335 00:19:52,400 --> 00:19:55,280 Speaker 4: you know, against each other, would China, you know, would 336 00:19:55,280 --> 00:19:57,840 Speaker 4: the United States be able to cut off the flow 337 00:19:58,280 --> 00:20:01,440 Speaker 4: of oil to China. And just to put this even 338 00:20:01,720 --> 00:20:05,160 Speaker 4: in sort of broader historical context, you know, if we 339 00:20:05,240 --> 00:20:09,480 Speaker 4: go back to the nineteen sixties, at the time that 340 00:20:09,560 --> 00:20:13,120 Speaker 4: the relationship between China and the Soviet Union was following 341 00:20:13,440 --> 00:20:19,240 Speaker 4: was falling apart, at that point, China was heavily reliant 342 00:20:19,520 --> 00:20:24,600 Speaker 4: on the Soviet Union for refined products needed to fuel 343 00:20:24,800 --> 00:20:29,280 Speaker 4: its military jet fuel. And so as those tensions between 344 00:20:29,359 --> 00:20:33,520 Speaker 4: China and the Soviet Union increased, the US's are did 345 00:20:33,560 --> 00:20:37,760 Speaker 4: cut back on refined oil product exports to China, you know, 346 00:20:37,840 --> 00:20:41,119 Speaker 4: so certainly, you know, there are examples, you know, looking 347 00:20:41,200 --> 00:20:44,119 Speaker 4: sort of further back in time, they're basically, you know, 348 00:20:44,160 --> 00:20:47,000 Speaker 4: the reason I'm sharing this bit of history with you 349 00:20:47,359 --> 00:20:49,879 Speaker 4: is to let you know that China has first hand 350 00:20:49,920 --> 00:20:53,960 Speaker 4: experience of being in you know, a tense relationship with 351 00:20:54,119 --> 00:20:58,359 Speaker 4: another major power and having that major power you know, 352 00:20:58,480 --> 00:21:03,040 Speaker 4: squeezed the country with respect to imported oil products. 353 00:21:03,640 --> 00:21:05,840 Speaker 3: Actually, this might be a good time to ask just 354 00:21:05,880 --> 00:21:10,479 Speaker 3: about China's foreign policy more broadly. So I saw, you know, 355 00:21:10,760 --> 00:21:14,680 Speaker 3: they issued a statement following the attacks, and I read 356 00:21:14,720 --> 00:21:16,720 Speaker 3: one person describe it as the kind of thing you 357 00:21:16,720 --> 00:21:21,119 Speaker 3: would expect from Brussels, you know, very very generic, expressing 358 00:21:21,200 --> 00:21:24,840 Speaker 3: concern over the situation in Iran, but they also expressed 359 00:21:24,880 --> 00:21:29,600 Speaker 3: concern over the attacks on the UAE, for instance, which 360 00:21:29,840 --> 00:21:34,320 Speaker 3: is of economic importance to China. Certainly, what's your sense 361 00:21:34,440 --> 00:21:38,080 Speaker 3: of I guess what is at stake beyond just oil 362 00:21:38,560 --> 00:21:42,240 Speaker 3: for China in this particular situation, you know, sort. 363 00:21:42,040 --> 00:21:46,639 Speaker 4: Of looking beyond China's energy imports from the region. China 364 00:21:47,200 --> 00:21:51,240 Speaker 4: national oil companies are big producers in a rock, so 365 00:21:51,280 --> 00:21:55,480 Speaker 4: they have a number of upstream assets in that country. 366 00:21:56,200 --> 00:22:01,600 Speaker 4: Chinese firms are also involved in building other types of 367 00:22:01,720 --> 00:22:06,600 Speaker 4: infrastructure in the region. For example, there are Chinese companies 368 00:22:06,800 --> 00:22:15,040 Speaker 4: that are building operating renewable energy facilities, especially solar farms 369 00:22:15,119 --> 00:22:19,239 Speaker 4: in the region, and because of this, we've seen you know, 370 00:22:19,400 --> 00:22:23,280 Speaker 4: Beijing call not just you know, for everyone to help 371 00:22:23,359 --> 00:22:28,119 Speaker 4: ensure the free flow of energy from the region, but 372 00:22:28,440 --> 00:22:31,600 Speaker 4: also to make sure that civilians aren't hit, right, because 373 00:22:31,640 --> 00:22:34,639 Speaker 4: you have Chinese citizens on the ground there. It doesn't 374 00:22:34,640 --> 00:22:38,320 Speaker 4: want any of its physical economic assets infrastructure in the 375 00:22:38,359 --> 00:22:40,960 Speaker 4: region to get hit. So that's that, you know that 376 00:22:41,000 --> 00:22:42,959 Speaker 4: the people on assets side of the story. 377 00:22:43,640 --> 00:22:47,520 Speaker 3: Joe, I just remembered in Dubai kind of outside of 378 00:22:47,600 --> 00:22:51,000 Speaker 3: like main Dubai, there was this small and it was 379 00:22:51,040 --> 00:22:52,840 Speaker 3: called I think it was called Dragon Mark, and it 380 00:22:52,920 --> 00:22:57,600 Speaker 3: was just a Chinese market. You would love it absolutely, 381 00:22:58,119 --> 00:23:01,600 Speaker 3: like everything imaginable was available there, and like when you 382 00:23:01,680 --> 00:23:03,800 Speaker 3: went there it felt very very surreal. 383 00:23:03,880 --> 00:23:06,359 Speaker 2: Actually, yeah, I would love it. That sounds like the 384 00:23:06,359 --> 00:23:08,840 Speaker 2: most interesting thing I've heard of in Dubai. Nothing else 385 00:23:08,880 --> 00:23:11,800 Speaker 2: I've never nothing else about Dubai's ever made me. 386 00:23:11,960 --> 00:23:13,800 Speaker 3: I can tell you more interesting things. So it's the 387 00:23:13,880 --> 00:23:15,679 Speaker 3: North Korean restaurants and things like that. 388 00:23:15,720 --> 00:23:18,080 Speaker 2: Oh I want I want to check out North Korean restaurant. 389 00:23:19,840 --> 00:23:21,800 Speaker 3: Maybe you do and maybe you don't. I've been to 390 00:23:22,920 --> 00:23:24,360 Speaker 3: oh really many years ago. 391 00:23:24,560 --> 00:23:26,720 Speaker 2: Yeah, I've read about them I've read about like the 392 00:23:26,800 --> 00:23:30,080 Speaker 2: chain of North very I mean it's just Korean. 393 00:23:29,800 --> 00:23:33,280 Speaker 3: Food, right, I mean, well it's slightly it has its 394 00:23:33,320 --> 00:23:36,920 Speaker 3: own twist. It's good food, not so great surveillance. That's 395 00:23:36,960 --> 00:23:39,520 Speaker 3: how i'll or actually, maybe the surveillance is a little 396 00:23:39,560 --> 00:23:40,000 Speaker 3: too good. 397 00:23:40,080 --> 00:23:43,240 Speaker 2: Yeah, yeah, there we go. Good food excellent. That's like 398 00:23:43,240 --> 00:23:44,919 Speaker 2: like a great Yelp reviews. 399 00:23:45,119 --> 00:23:49,719 Speaker 3: Surveillance was great, the food, good food, excellen excellent. 400 00:23:52,160 --> 00:23:54,720 Speaker 2: Stay for the face recognition, you know, I get the 401 00:23:54,760 --> 00:23:58,800 Speaker 2: impression with just to stick on Chinese foreign policy for 402 00:23:58,840 --> 00:24:02,080 Speaker 2: a second. One thing I hadn't realized up until recently. 403 00:24:02,840 --> 00:24:05,520 Speaker 2: It just hadn't dawned on me, is like China doesn't 404 00:24:05,520 --> 00:24:08,440 Speaker 2: have any like formal like treaty allies. You know, there's 405 00:24:08,520 --> 00:24:11,560 Speaker 2: like nobody unlike the US, like we have an agreement 406 00:24:11,680 --> 00:24:14,480 Speaker 2: we then you know, we're obligated or we agree to 407 00:24:14,480 --> 00:24:17,240 Speaker 2: defend them. I don't think China does it that way. 408 00:24:17,480 --> 00:24:21,080 Speaker 2: Like I was surprised, you know at the kind of 409 00:24:21,560 --> 00:24:24,040 Speaker 2: Tracy mentioned that, the sort of neutralish tone. It's like 410 00:24:24,240 --> 00:24:27,800 Speaker 2: telling Iran, like be careful in your retaliation and who 411 00:24:27,840 --> 00:24:31,359 Speaker 2: you hit for obvious some of the reasons that you mentioned, 412 00:24:32,000 --> 00:24:34,280 Speaker 2: you know, but it's certainly not like we're seeing China 413 00:24:34,359 --> 00:24:36,840 Speaker 2: make any statement like we're gonna we're gonna up our 414 00:24:36,920 --> 00:24:40,320 Speaker 2: shipments of weapons or defense weapons to Iran. Maybe they're 415 00:24:40,359 --> 00:24:42,320 Speaker 2: doing some of that covertly, but they don't make a 416 00:24:42,320 --> 00:24:45,040 Speaker 2: big announcement of it. But it strikes me like that's 417 00:24:45,119 --> 00:24:48,160 Speaker 2: very telling that even a country with whom they have 418 00:24:48,280 --> 00:24:52,720 Speaker 2: a fairly substantial economic partnership with and maybe some sort 419 00:24:52,720 --> 00:24:57,760 Speaker 2: of ideological alignment in terms of countering Western hegemony and 420 00:24:57,800 --> 00:25:00,760 Speaker 2: so forth, you know, still even with them, there's nothing 421 00:25:01,119 --> 00:25:03,679 Speaker 2: formally established talk a little bit more about how they 422 00:25:03,680 --> 00:25:06,359 Speaker 2: think strategically about the region beyond just the sort of 423 00:25:06,480 --> 00:25:08,240 Speaker 2: commercial needs. 424 00:25:08,920 --> 00:25:13,920 Speaker 4: Sure, so China wants to maintain good relations with Iran, 425 00:25:14,560 --> 00:25:18,840 Speaker 4: and it also wants to maintain good relations with Saudi Arabia, 426 00:25:19,480 --> 00:25:22,520 Speaker 4: uae Oman and other states in the region. And so 427 00:25:22,920 --> 00:25:26,840 Speaker 4: China historically has you know, sort of walked this type rope, 428 00:25:26,960 --> 00:25:30,320 Speaker 4: you know, in trying to balance relationships you know, the 429 00:25:30,359 --> 00:25:34,120 Speaker 4: Saudias with the Iranians, and I think they have been 430 00:25:34,359 --> 00:25:41,120 Speaker 4: pretty successful in pulling that off. Now, China has no 431 00:25:41,480 --> 00:25:46,560 Speaker 4: interest in getting bogged down in a military conflict in 432 00:25:46,600 --> 00:25:49,840 Speaker 4: the region. So we're not going to see China get 433 00:25:49,840 --> 00:25:55,800 Speaker 4: involved in that. They are happy to be a mediator 434 00:25:56,040 --> 00:25:59,120 Speaker 4: and in fact aging you know, recently announced i think 435 00:25:59,160 --> 00:26:02,920 Speaker 4: just a few hours go that they are sending their 436 00:26:03,440 --> 00:26:09,320 Speaker 4: special envoy to the region for mediation purposes. And so 437 00:26:09,359 --> 00:26:12,720 Speaker 4: I think that China likes playing that role. I think 438 00:26:12,720 --> 00:26:18,920 Speaker 4: it certainly bolsters their image as a sort of responsible 439 00:26:19,480 --> 00:26:25,520 Speaker 4: outside power, that is, you know, getting involved in the region, 440 00:26:25,760 --> 00:26:29,000 Speaker 4: you know, with the goal of restoring peace and stability. 441 00:26:44,960 --> 00:26:46,720 Speaker 3: So one thing I wanted to make sure to ask 442 00:26:46,760 --> 00:26:50,600 Speaker 3: you is just more broadly, you've spent your entire academic 443 00:26:50,600 --> 00:26:54,680 Speaker 3: career studying Chinese energy markets and Chinese energy policy. What's 444 00:26:54,720 --> 00:26:58,400 Speaker 3: the one thing you think people should know about that 445 00:26:58,480 --> 00:27:02,200 Speaker 3: particular market or the one thing that makes China unusual 446 00:27:02,359 --> 00:27:05,480 Speaker 3: in the grand scheme of global energy policies. 447 00:27:05,960 --> 00:27:10,280 Speaker 4: So one thing I'd like to highlight is China's changing 448 00:27:10,480 --> 00:27:15,159 Speaker 4: role in the global energy system. So, for most of 449 00:27:15,200 --> 00:27:20,399 Speaker 4: the time that I've been following China's energy sector, it's 450 00:27:20,920 --> 00:27:24,040 Speaker 4: been looking at China's role in global energy markets. It's 451 00:27:24,080 --> 00:27:29,720 Speaker 4: been China as a growing importer of oil and natural gas, 452 00:27:30,000 --> 00:27:34,680 Speaker 4: both pipeline gas and LNG, as an opportunistic whole importer. 453 00:27:35,560 --> 00:27:40,760 Speaker 4: But there's an important change underway in China, which is 454 00:27:40,800 --> 00:27:47,240 Speaker 4: that the country is transitioning to a lower carbon future. 455 00:27:47,480 --> 00:27:49,639 Speaker 4: You may have seen a lot of news reports about 456 00:27:50,560 --> 00:27:55,879 Speaker 4: record level of wind and solar capacity installations in China. 457 00:27:56,400 --> 00:28:02,200 Speaker 4: Part of this is certainly about decarbonation, it's also about 458 00:28:02,600 --> 00:28:05,920 Speaker 4: energy supply security. You know that I think one thing 459 00:28:06,080 --> 00:28:09,960 Speaker 4: China has taken away from the war in Ukraine, from 460 00:28:10,240 --> 00:28:14,320 Speaker 4: you know, US activities in Venezuela, you know, the current 461 00:28:14,520 --> 00:28:18,840 Speaker 4: war in Iran, is that, you know, it's better just 462 00:28:18,960 --> 00:28:22,840 Speaker 4: to be able to rely on energy sources within your 463 00:28:22,880 --> 00:28:25,720 Speaker 4: own borders. There's an energy supply story as well. There's 464 00:28:25,720 --> 00:28:28,360 Speaker 4: an energy security story for China. But the other thing 465 00:28:28,400 --> 00:28:29,920 Speaker 4: that's going on here. 466 00:28:29,840 --> 00:28:34,280 Speaker 5: Is that China wants to continue to be the supplier 467 00:28:34,800 --> 00:28:38,040 Speaker 5: of the green technologies that the rest of the world 468 00:28:38,120 --> 00:28:44,200 Speaker 5: needs for decarbonization, energy security, you know, access to reliable 469 00:28:44,600 --> 00:28:46,480 Speaker 5: and affordable energy. 470 00:28:46,960 --> 00:28:49,520 Speaker 4: So those three sets of goals, and so we are 471 00:28:49,720 --> 00:28:56,920 Speaker 4: seeing China emerge as this green tech superpower, if you will. 472 00:28:57,280 --> 00:29:00,920 Speaker 4: And so it's very interesting to think about this in 473 00:29:01,000 --> 00:29:03,920 Speaker 4: China playing this role. You know, at the same time 474 00:29:04,120 --> 00:29:10,160 Speaker 4: that the United States is advancing this agenda of energy dominance, 475 00:29:10,320 --> 00:29:14,200 Speaker 4: which of course is focused on you know, expporting more 476 00:29:14,520 --> 00:29:18,959 Speaker 4: US l G and oil and sort of using those 477 00:29:19,120 --> 00:29:22,560 Speaker 4: as a source of leverage. When I think about that, 478 00:29:22,640 --> 00:29:25,600 Speaker 4: my instinctive reaction is, you know, maybe more of course, 479 00:29:25,640 --> 00:29:27,520 Speaker 4: it could be a chategor or stick, you know, but 480 00:29:27,600 --> 00:29:29,120 Speaker 4: I think of it as being more of a stick, 481 00:29:29,160 --> 00:29:32,280 Speaker 4: whereas I think that, you know, China has you know, 482 00:29:32,440 --> 00:29:37,080 Speaker 4: something very different that it can offer that might be 483 00:29:37,240 --> 00:29:39,600 Speaker 4: quite appealing to a lot of countries in the world. 484 00:29:39,680 --> 00:29:42,080 Speaker 4: These a lot of countries don't want to spend a 485 00:29:42,120 --> 00:29:44,920 Speaker 4: lot of their foreign exchange and energy imports. They don't 486 00:29:44,960 --> 00:29:49,200 Speaker 4: want to be vulnerable to supply disruptions. And so if 487 00:29:49,280 --> 00:29:52,640 Speaker 4: China's coming along and saying that, okay, you have you know, 488 00:29:52,920 --> 00:29:56,960 Speaker 4: great solar energy resources, and you can buy solar panels 489 00:29:56,960 --> 00:29:59,240 Speaker 4: for US, or you can hire you know, a Chinese 490 00:29:59,240 --> 00:30:02,880 Speaker 4: EPC contract to build you you know, a solar farm, 491 00:30:03,440 --> 00:30:06,440 Speaker 4: then you know, countries don't have to spend as much 492 00:30:06,600 --> 00:30:10,360 Speaker 4: energy on foreign exchange. And just as one example, did 493 00:30:10,400 --> 00:30:12,719 Speaker 4: a lot of work a number of years ago, like 494 00:30:13,040 --> 00:30:17,920 Speaker 4: twenty eighteen, twenty nineteen, looking at why China was building 495 00:30:18,280 --> 00:30:21,600 Speaker 4: so many coal fired power plants in Pakistan, when the 496 00:30:21,600 --> 00:30:24,960 Speaker 4: country had you know, tremendous you know, renewable energy resource, 497 00:30:25,080 --> 00:30:28,720 Speaker 4: you know, when the solar resources, especially especially solar, and 498 00:30:29,400 --> 00:30:32,680 Speaker 4: I ended up doing this deep dive into Pakistan's energy sector. 499 00:30:33,000 --> 00:30:35,040 Speaker 4: You know, one of the things I discovered is that 500 00:30:35,080 --> 00:30:37,720 Speaker 4: they were spending a lot of you know, very precious 501 00:30:37,800 --> 00:30:41,640 Speaker 4: foreign exchange on you know, importing fuel, oil, you know, 502 00:30:41,720 --> 00:30:45,320 Speaker 4: and now coal to run these power plants. And that 503 00:30:45,520 --> 00:30:48,480 Speaker 4: was an issue. And now we are seeing there have 504 00:30:48,480 --> 00:30:50,680 Speaker 4: been a lot of reports over the past year about 505 00:30:50,680 --> 00:30:55,040 Speaker 4: how you have individual households and businesses in Pakistan that 506 00:30:55,080 --> 00:30:57,480 Speaker 4: have been buying a lot of Chinese solar panels to 507 00:30:57,520 --> 00:31:01,440 Speaker 4: put on their roofs so that they have affordable and 508 00:31:01,680 --> 00:31:05,920 Speaker 4: reliable energy. And so I just whenever I hear about 509 00:31:05,920 --> 00:31:08,840 Speaker 4: the Pakistan example, I keep thinking back to that earlier 510 00:31:08,880 --> 00:31:12,360 Speaker 4: research that I did and how you know, this to 511 00:31:12,360 --> 00:31:16,080 Speaker 4: a certain extent has to be helping Pakistan concern foreign 512 00:31:16,080 --> 00:31:18,920 Speaker 4: exchange or conserve for an exchange that it previously it 513 00:31:19,000 --> 00:31:21,920 Speaker 4: would have spent on energy imports. I don't know the 514 00:31:21,960 --> 00:31:24,160 Speaker 4: size of the savings off the top of my head, 515 00:31:24,240 --> 00:31:26,760 Speaker 4: but that's just one example I wanted to highlight. 516 00:31:27,160 --> 00:31:29,960 Speaker 2: Yeah, it does seem like you know, for most of 517 00:31:30,040 --> 00:31:34,479 Speaker 2: recent history and still today, like fossil fuel dominance is 518 00:31:34,480 --> 00:31:37,080 Speaker 2: incredibly important, and it's not like that's not going to 519 00:31:37,200 --> 00:31:41,080 Speaker 2: change overnight. And so, yes, you have incredible fossil fuel 520 00:31:41,320 --> 00:31:45,800 Speaker 2: capacity reserves in the US, Latin America, the Middle East, 521 00:31:45,880 --> 00:31:50,200 Speaker 2: and so forth. But the longer term trend, as you 522 00:31:50,240 --> 00:31:53,040 Speaker 2: spell it out, seems to be like at some point 523 00:31:54,080 --> 00:31:56,960 Speaker 2: that much of the world just doesn't need as much 524 00:31:57,000 --> 00:32:00,440 Speaker 2: of it, and their ability to reduce their energy bill 525 00:32:00,920 --> 00:32:05,080 Speaker 2: will come from Chinese technology, whether we're talking about wind, 526 00:32:05,200 --> 00:32:10,080 Speaker 2: solar or batteries that has been installed domestically and potentially 527 00:32:10,160 --> 00:32:12,640 Speaker 2: reducing their bill. And so the payments that were at 528 00:32:12,640 --> 00:32:15,320 Speaker 2: one point going to the US or going to the UAE, 529 00:32:15,480 --> 00:32:23,520 Speaker 2: et cetera, switches to being payments for renewable technology from China. Yes, great, 530 00:32:25,560 --> 00:32:27,680 Speaker 2: I summed up the uh I mean I can also. 531 00:32:27,760 --> 00:32:29,800 Speaker 4: I mean the other sort of thing here is that 532 00:32:29,880 --> 00:32:32,200 Speaker 4: I mean I think that you sort of you know, 533 00:32:32,600 --> 00:32:38,480 Speaker 4: looking again at China, China's demand for diesel and gasoline 534 00:32:38,800 --> 00:32:41,920 Speaker 4: has already peaked. In the case of diesel, a lot 535 00:32:41,920 --> 00:32:43,920 Speaker 4: of that has to do with the property collapse, you know. 536 00:32:43,960 --> 00:32:49,560 Speaker 4: With gasoline, it's been the rapid uptake of evs. And 537 00:32:50,200 --> 00:32:53,280 Speaker 4: as a result of this very rapid uptake of evs, 538 00:32:53,760 --> 00:32:57,680 Speaker 4: the International Energy Agency, some of China's national oil companies 539 00:32:57,760 --> 00:33:01,080 Speaker 4: you know, have moved forward their date or when China's 540 00:33:01,120 --> 00:33:04,840 Speaker 4: you know, overall oil demands is going to peak. Before 541 00:33:05,360 --> 00:33:07,800 Speaker 4: I was seeing them, you know, years dates closer to 542 00:33:07,840 --> 00:33:11,320 Speaker 4: twenty thirty now twenty twenty seven. At one point, Signupeck, 543 00:33:11,360 --> 00:33:13,880 Speaker 4: one of the national oil companies, had even said, you know, 544 00:33:13,920 --> 00:33:17,360 Speaker 4: twenty twenty five. And so as I mentioned, we have 545 00:33:17,520 --> 00:33:20,720 Speaker 4: seen you know, demand for road transport fuel peak. But 546 00:33:20,960 --> 00:33:26,920 Speaker 4: China will still need oil for petro chemicals, which in 547 00:33:26,960 --> 00:33:29,920 Speaker 4: turn are used in some of these green technologies, right 548 00:33:30,200 --> 00:33:35,960 Speaker 4: like we need petrochemicals, fees stocks as inputs for evs, 549 00:33:36,000 --> 00:33:39,920 Speaker 4: for solar panels or withium ion batteries. So there is 550 00:33:40,000 --> 00:33:42,440 Speaker 4: a link there and we will see, you know, China 551 00:33:42,440 --> 00:33:46,120 Speaker 4: still needs to import some oil to continue to be 552 00:33:46,280 --> 00:33:49,040 Speaker 4: a leader in manufacturing technologies. 553 00:33:49,360 --> 00:33:53,360 Speaker 3: So I know you're not a macroeconomist, obviously, but when 554 00:33:53,360 --> 00:33:56,240 Speaker 3: you look at what's happening now in Iran and the 555 00:33:56,280 --> 00:33:59,719 Speaker 3: situation in the Middle East, what's your best guess for 556 00:33:59,800 --> 00:34:04,520 Speaker 3: how this actually feeds into Chinese inflation and the broader 557 00:34:04,600 --> 00:34:07,880 Speaker 3: I guess energy prices, like, how much could we actually 558 00:34:07,920 --> 00:34:12,080 Speaker 3: see domestic energy prices in China go up as a 559 00:34:12,120 --> 00:34:15,319 Speaker 3: result of curtailed supply, And how much of that curt 560 00:34:15,400 --> 00:34:18,160 Speaker 3: tailed supply can just be offset from the reserve. 561 00:34:20,680 --> 00:34:25,080 Speaker 4: Yeah, so we are seeing higher prices for energy. I 562 00:34:25,120 --> 00:34:26,759 Speaker 4: know we've been talking a lot about oil, but I 563 00:34:26,880 --> 00:34:31,560 Speaker 4: actually like to turn to l G to answer this question. 564 00:34:31,920 --> 00:34:38,879 Speaker 4: So China imports almost one third of its ll G 565 00:34:39,719 --> 00:34:44,040 Speaker 4: from the Middle East. Almost all of that comes from Cutter, 566 00:34:44,520 --> 00:34:47,839 Speaker 4: with a little bit from the UAE and oman Uman 567 00:34:47,920 --> 00:34:50,360 Speaker 4: obviously lies outside the street of Hormus. But if you 568 00:34:50,360 --> 00:34:52,960 Speaker 4: look at the supplies coming you know, first and foremost 569 00:34:53,000 --> 00:34:56,000 Speaker 4: from Cutter and that little bit you know from the UAE, 570 00:34:56,160 --> 00:35:01,640 Speaker 4: those supplies are no longer flowing to China. And China 571 00:35:01,680 --> 00:35:04,920 Speaker 4: doesn't have a massive strategic gas reserve, you know, the 572 00:35:04,960 --> 00:35:09,120 Speaker 4: way it does with oil. And so the longer apply 573 00:35:09,760 --> 00:35:15,120 Speaker 4: of LNG from from Cutter to China is disrupted, you know, 574 00:35:15,160 --> 00:35:17,840 Speaker 4: the more China is going to be under pressure to 575 00:35:17,840 --> 00:35:20,400 Speaker 4: cobble together a response. And I think in the very 576 00:35:20,440 --> 00:35:23,319 Speaker 4: short term one of the big things, you know, that 577 00:35:23,360 --> 00:35:27,040 Speaker 4: they can do is find ways to use less gas 578 00:35:27,040 --> 00:35:31,480 Speaker 4: and hear sky high prices for spot cargos is going 579 00:35:31,560 --> 00:35:34,359 Speaker 4: to help China do that, you know, And there has 580 00:35:34,440 --> 00:35:38,040 Speaker 4: been reporting an industry press where a name with traders, 581 00:35:38,160 --> 00:35:40,319 Speaker 4: you know, certainly at the big state owned companies, have 582 00:35:40,440 --> 00:35:42,600 Speaker 4: been saying that, you know, we're not going to buy 583 00:35:42,640 --> 00:35:45,719 Speaker 4: anything on the spot market right now because prices are 584 00:35:45,960 --> 00:35:46,799 Speaker 4: just too hot. 585 00:35:48,480 --> 00:35:50,680 Speaker 2: Do they frack in China? Have they got into the 586 00:35:50,719 --> 00:35:53,080 Speaker 2: fracking revolution yet? Is that a thing over there? 587 00:35:53,840 --> 00:35:59,000 Speaker 4: Yeah? They have. And actually last year, forty three percent 588 00:35:59,280 --> 00:36:05,160 Speaker 4: of China's natural gas production came from unconventional sources. And 589 00:36:05,200 --> 00:36:08,960 Speaker 4: the statistic is really of interest to me because I remember, 590 00:36:09,239 --> 00:36:13,239 Speaker 4: you know, back when the US shale revolution was taking off, 591 00:36:13,320 --> 00:36:18,000 Speaker 4: people would often note that on paper, China's shale resources 592 00:36:18,120 --> 00:36:21,480 Speaker 4: were either you know, we're bigger than or you know, 593 00:36:21,520 --> 00:36:23,880 Speaker 4: almost as big as the United States, like basically about 594 00:36:24,000 --> 00:36:26,080 Speaker 4: I mean this is going back like fifteen sixteen years, 595 00:36:26,280 --> 00:36:31,200 Speaker 4: but basically there were big China had big shale resources 596 00:36:31,239 --> 00:36:34,000 Speaker 4: on paper. So I would often get the question, you know, 597 00:36:34,239 --> 00:36:37,080 Speaker 4: are we going to see a shale revolution in China? 598 00:36:37,400 --> 00:36:39,880 Speaker 4: My answer was, it's going to be more of a 599 00:36:39,960 --> 00:36:46,400 Speaker 4: shale evolution because of different factors in the United States 600 00:36:46,520 --> 00:36:49,640 Speaker 4: and China. Like in the United States, for example, people 601 00:36:49,640 --> 00:36:52,680 Speaker 4: who were sitting above you know, promising shale resources could 602 00:36:52,680 --> 00:36:56,080 Speaker 4: be compensated for that, not so much in China. You know, 603 00:36:56,120 --> 00:36:58,920 Speaker 4: in the United States, you know, the shale revolution was 604 00:36:58,960 --> 00:37:04,799 Speaker 4: really launched to buy these you know, small nimble companies 605 00:37:05,000 --> 00:37:08,080 Speaker 4: need to maximize profit, Whereas in China, if you look 606 00:37:08,239 --> 00:37:11,520 Speaker 4: at all the you know, upstream oil and gas assets, 607 00:37:11,520 --> 00:37:15,040 Speaker 4: they're concentrated in the hands of China's nit and national 608 00:37:15,080 --> 00:37:18,920 Speaker 4: oil companies, which are state owned, maybe not as nimble 609 00:37:19,000 --> 00:37:21,120 Speaker 4: and certainly have you know, and so you know, so 610 00:37:21,120 --> 00:37:22,799 Speaker 4: there are a number of different factors as they're just 611 00:37:22,880 --> 00:37:25,319 Speaker 4: you know, two that I can which I'm actually I can. 612 00:37:25,640 --> 00:37:28,200 Speaker 3: I'm really interested in this because if you think about 613 00:37:28,360 --> 00:37:32,799 Speaker 3: China's large infrastructure projects and it's renewable build out, it 614 00:37:32,840 --> 00:37:36,000 Speaker 3: feels like they basically are able to flip a switch 615 00:37:36,200 --> 00:37:38,120 Speaker 3: and say like, we want to go big on this, 616 00:37:38,360 --> 00:37:40,440 Speaker 3: and then they go big on this relatively quickly and 617 00:37:40,520 --> 00:37:44,720 Speaker 3: probably faster than it usually happens in places like the States. 618 00:37:44,719 --> 00:37:47,960 Speaker 3: But you're saying for this one thing, for fracking, that 619 00:37:48,080 --> 00:37:50,400 Speaker 3: wasn't the case, which is very surprising to me. 620 00:37:51,239 --> 00:37:55,360 Speaker 4: Yeah, it's been a much more gradual build up of 621 00:37:55,719 --> 00:37:59,319 Speaker 4: unconventional gas production in China. And of course, you know 622 00:37:59,320 --> 00:38:01,640 Speaker 4: when I say forty three percent of gas production, you 623 00:38:01,640 --> 00:38:04,719 Speaker 4: know it's from unconventional sources. You know, that's also including 624 00:38:04,800 --> 00:38:07,839 Speaker 4: things like like type gass. It's not all shale, although 625 00:38:07,880 --> 00:38:11,480 Speaker 4: shale is absolutely part of the story. Yeah, and so 626 00:38:11,760 --> 00:38:14,320 Speaker 4: to your point, yes, this was a much more gradual 627 00:38:14,600 --> 00:38:17,040 Speaker 4: build up in unconventional gas production. 628 00:38:17,440 --> 00:38:20,840 Speaker 2: Eric Adown's fascinating conversation. I learned a lot in that 629 00:38:20,960 --> 00:38:23,560 Speaker 2: forty five minutes. Really appreciate you coming on to odd 630 00:38:23,600 --> 00:38:26,239 Speaker 2: Lots and yeah, thanks for joining us. Thanks so much 631 00:38:26,280 --> 00:38:41,480 Speaker 2: for having me, Tracy, that was a really interesting conversation. 632 00:38:41,600 --> 00:38:43,560 Speaker 2: I didn't know that about the I mean, I guess 633 00:38:43,600 --> 00:38:46,160 Speaker 2: I'm not surprised that there were small refineries, but that 634 00:38:46,200 --> 00:38:49,040 Speaker 2: they served this very strategic focus of not having those 635 00:38:49,080 --> 00:38:51,760 Speaker 2: international I guess liabilities, right. 636 00:38:51,600 --> 00:38:56,360 Speaker 3: They don't have real system that they've built outside of 637 00:38:56,480 --> 00:39:01,080 Speaker 3: I guess the more regulated official energy industry. It's and 638 00:39:01,520 --> 00:39:04,960 Speaker 3: it's fascinating to me. A it's a good exercise in 639 00:39:05,040 --> 00:39:07,840 Speaker 3: branding because I just find the teapot yeah so compelling. 640 00:39:08,000 --> 00:39:11,960 Speaker 3: But also it's like an entire arbitrage industry. 641 00:39:11,680 --> 00:39:14,120 Speaker 2: Right, yeah, yeah, no, it makes sense. Right, Like there's 642 00:39:14,160 --> 00:39:17,560 Speaker 2: always gonna be someone sanctioned rights that seems like safe. 643 00:39:17,719 --> 00:39:18,959 Speaker 2: There's always especially. 644 00:39:18,760 --> 00:39:22,400 Speaker 3: Three certainties in life death taxes, and someone somewhere is 645 00:39:22,400 --> 00:39:23,480 Speaker 3: going to have their oil sanction. 646 00:39:23,680 --> 00:39:27,160 Speaker 2: That's absolutely true, and so yeah, but they're going to 647 00:39:27,239 --> 00:39:29,239 Speaker 2: sell it, and they're going to sell it at a discount. 648 00:39:29,480 --> 00:39:33,840 Speaker 2: And obviously any buyer of sanctioned commodities is going to 649 00:39:33,880 --> 00:39:36,160 Speaker 2: be taking on some sort of risk that they're going 650 00:39:36,200 --> 00:39:39,120 Speaker 2: to get slabbed with, like a secondary sanction or penalty 651 00:39:39,200 --> 00:39:41,759 Speaker 2: and so forth. So it makes sense to have a 652 00:39:41,880 --> 00:39:46,760 Speaker 2: sort of a you know, decentralized cottage industry. Cottage industry, 653 00:39:46,760 --> 00:39:48,839 Speaker 2: it's another cute Sunday that it's not really cute. It's 654 00:39:48,840 --> 00:39:51,880 Speaker 2: all very cute, it's all very cute. But yeah, this 655 00:39:52,000 --> 00:39:54,600 Speaker 2: separate industry that does not have the same they're not 656 00:39:54,640 --> 00:39:55,880 Speaker 2: exposed in some way. 657 00:39:56,040 --> 00:39:59,120 Speaker 3: Yeah, and the other thing I was very interested to hear, obviously, 658 00:39:59,200 --> 00:40:03,320 Speaker 3: the discussion around the strategic petroleum reserve was very interesting. 659 00:40:03,400 --> 00:40:06,960 Speaker 3: This idea that you know, there might be foreign policy 660 00:40:07,000 --> 00:40:11,520 Speaker 3: considerations behind building up that strategic supply. Also the idea 661 00:40:11,520 --> 00:40:14,520 Speaker 3: that shale hasn't taken off as fast in China. Like again, 662 00:40:14,560 --> 00:40:18,160 Speaker 3: that really surprises me. We're so used to hearing that 663 00:40:18,160 --> 00:40:20,200 Speaker 3: one of the benefits of a command economy is that 664 00:40:20,239 --> 00:40:23,440 Speaker 3: you can more of us, you know, direct this big stuff, 665 00:40:23,560 --> 00:40:25,520 Speaker 3: and it doesn't seem to have happened in the case 666 00:40:25,560 --> 00:40:27,640 Speaker 3: of shale. And again maybe that maybe that's more of 667 00:40:27,680 --> 00:40:29,120 Speaker 3: a strategic decision I. 668 00:40:29,080 --> 00:40:31,320 Speaker 2: Was going to say. I mean, what I would surmise 669 00:40:31,400 --> 00:40:33,600 Speaker 2: and is just speculation, is like no, like the big 670 00:40:33,640 --> 00:40:39,920 Speaker 2: priority is the priority is batteries, solar, wind and so forth. 671 00:40:40,680 --> 00:40:42,480 Speaker 2: And I do think this is like going to be 672 00:40:42,520 --> 00:40:44,840 Speaker 2: the big I don't know how long it take place, 673 00:40:45,360 --> 00:40:48,640 Speaker 2: but the big shift that's already happening I guess under 674 00:40:48,719 --> 00:40:51,759 Speaker 2: underway is this like a bunch of other countries that 675 00:40:51,800 --> 00:40:54,480 Speaker 2: aren't the US and aren't China are going to want 676 00:40:54,480 --> 00:40:57,360 Speaker 2: to reduce their energy import bill and they're going to 677 00:40:57,440 --> 00:41:00,800 Speaker 2: swap it for an energy technology bill that they licensed 678 00:41:00,840 --> 00:41:04,319 Speaker 2: from China. And that is a long term I. 679 00:41:04,239 --> 00:41:05,439 Speaker 3: Think that's a really important point. 680 00:41:05,440 --> 00:41:08,640 Speaker 2: It's a really important trend. And events like the war 681 00:41:09,160 --> 00:41:12,960 Speaker 2: are in the short term going to raise China's importvill 682 00:41:13,040 --> 00:41:15,600 Speaker 2: and others, and in the long term or the medium 683 00:41:15,680 --> 00:41:19,239 Speaker 2: term encourage more countries to accelerate that transition. So that's 684 00:41:19,239 --> 00:41:20,359 Speaker 2: a pretty big story. 685 00:41:20,160 --> 00:41:22,560 Speaker 3: Pros and cons. Yes, if there's anyone out there who's 686 00:41:22,600 --> 00:41:25,880 Speaker 3: working in Chinese hill or fracking, or has attempted to 687 00:41:25,920 --> 00:41:28,880 Speaker 3: work in Chinese hill or fracking, I'd be very interested 688 00:41:28,960 --> 00:41:29,719 Speaker 3: in talking to them. 689 00:41:29,719 --> 00:41:31,680 Speaker 2: So I want to watch the Landman of China. 690 00:41:33,280 --> 00:41:36,839 Speaker 3: I haven't watched the Landman America version, but I bet 691 00:41:36,920 --> 00:41:37,680 Speaker 3: that would be interesting. 692 00:41:37,840 --> 00:41:39,080 Speaker 2: You got to watch it, all right? 693 00:41:39,200 --> 00:41:39,960 Speaker 3: Shall we leave it there? 694 00:41:40,000 --> 00:41:40,640 Speaker 2: Let's leave it there. 695 00:41:40,680 --> 00:41:42,840 Speaker 3: This has been another episode of the Odd Laws podcast. 696 00:41:42,880 --> 00:41:45,640 Speaker 3: I'm Tracy Alloway. You can follow me at Tracy Alloway. 697 00:41:45,920 --> 00:41:48,000 Speaker 2: And I'm Jill wysan Thal. You can follow me at 698 00:41:48,000 --> 00:41:51,320 Speaker 2: the Stalwart. Follow our guest Erica Downs. She's at Erica Downs. 699 00:41:51,400 --> 00:41:54,680 Speaker 2: Follow our producers Carmen Rodriguez at Carmen Arman, dash Ob 700 00:41:54,680 --> 00:41:57,719 Speaker 2: Bennett at dashbot In, kel Brooks at Keil Brooks and 701 00:41:57,880 --> 00:42:00,400 Speaker 2: more Odd Laws content. Go to Bloomberg dot com slash 702 00:42:00,400 --> 00:42:02,440 Speaker 2: odd Lots or a daily newsletter, and all of our 703 00:42:02,480 --> 00:42:04,760 Speaker 2: episodes and you can shout about all of these topics. 704 00:42:04,760 --> 00:42:08,520 Speaker 2: Twenty four to seven in our discord Discord dot gg slash. 705 00:42:08,160 --> 00:42:11,040 Speaker 3: Odlots and if you enjoy Oddlots, if you like it 706 00:42:11,080 --> 00:42:14,040 Speaker 3: when we talk about teapot refineries and shale in China, 707 00:42:14,120 --> 00:42:16,520 Speaker 3: then please leave us a positive review on your favorite 708 00:42:16,520 --> 00:42:20,480 Speaker 3: podcast platform. And remember, if you are a Bloomberg subscriber, 709 00:42:20,560 --> 00:42:23,480 Speaker 3: you can listen to all of our episodes absolutely ad free. 710 00:42:23,640 --> 00:42:25,720 Speaker 3: All you need to do is find the Bloomberg channel 711 00:42:25,760 --> 00:42:29,520 Speaker 3: on Apple Podcasts and follow the instructions there. Thanks for listening.