Members of the Organization of Petroleum Exporting Countries (OPEC) are scheduled to hold an informal meeting in Algiers later this week. The continuous decline in oil prices is likely to be the main agenda at the meeting. However, experts believe that China's oil reserves may subvert any decision taken by OPEC members to push up petroleum prices.

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China is believed to have built a massive stockpile of oil under its government-managed strategic petroleum reserve (SPR) thanks to a long-running slump in oil prices. The reserve is an emergency stockpile which can provide the country not only energy security but also protection against any oil-related threats.

According to the International Energy Agency, China is the second largest consumer of oil globally. In recent times, China has emerged as a major importer of oil. While the country was able to boost its reserve by buying low-prices oil, it also offered a demand cushion to the global oil market at a time of supply glut.

However, experts believe that China may use these reserves if OPEC members choose to take drastic steps to control the supply of oil. OPEC countries are currently mulling various steps to ensure that the market is not flooded with oil and that oil prices can rise again.

Jodie Gunzberg, the global head of commodities and real assets at S&P Dow Jones Indices, said that China is likely to stop buying further oil if OPEC member raise the price of oil. In such a case, the country may resort to using its oil reserves. Gunzberg also suggested that China may even start exporting oil. 

Tagschina, opec, Oil