When the price of oil began to rise because of the war between the US and Iran, the European leaders and the US President said they would release some of the stockpile oil supplies they have in the country to moderate the price increases. What about the other fuels?

In an article by Keith Bradsher of The New York Times News Service, one of the other fuels affecting by closing the Strait of Hormuz was natural gas. Qatar produces 20% of the world’s supply.

In China, in Yancheng there are rows of storage tanks the size of a 20-story building filled with LNG or liquefied natural gas. The largest 6 hold enough to supply gas to 22 million people for 2 months.

The storage tanks are part of an effort by China over the past decade to accumulate stockpiles of all kinds of commodities from pork and rice to rare-earth metal and coal in case of disruptions of overseas supplies.

The natural gas supplies will help cushion the supply shocks even as its neighbors of India, Pakistan and Vietnam are running low of natural gas.

Qatar is the world’s biggest supplier of LNG and they have said it will take months to back 100% on line, as some of the drones and bombs from Iran damaged its facilities.

China is the world’s largest importer of natural gas and largest consumer of fertilizer which is made from natural gas. China does have some options, pipelines to Central Asia and Russia carry natural gas to China. It is possible to use coal rather than natural gas for some chemicals.

China does have a domestic oil and gas industry. It is the 4th largest producer of natural gas between the US, Russia and Iran. China is the 5th largest oil producer behind the US, Saudi Arabia, Russia and Canada.

Chinese government data show that natural gas imports from the Strait of Hormuz was 6.9% of the country’s overall gas consumption last year.

China is the world’s leader in alternatives of solar and wind energy to keep the lights on. The country generates only 4% of its electricity from natural gas and that could be replaced by coal or renewables.

The state-owned China Natural Offshore Oil Corporation has built 18 of its largest size storage tanks, more than twice as many as the rest of the world. South Korea is constructing 7 tanks, but they will not be ready till 2029. Japan has begun slightly smaller storage tanks.

In terms of fertilizer, China has halted overseas fertilizer sales since the war began.

Linking to dividend paying stocks, China can do many things because they have multiple state owned companies, however when a company continually makes profits, it has the ability to ensure some of the money is used to ensure no supplies will be disrupted to it. For your investments, what supplies are the companies dependent upon outside its borders?

There are more questions than answers, till the next time – to raising questions.