Why China Gas Subsidies Don't Matter

"Chinese subsidization of oil prices is not what drives world oil prices – 90 percent increase in the last 9 month with no substantial changes in quantities traded [is what did it]," Rusek said.

In the past few years global oil demand increase by about 9 million barrels per day while at the same time production of oil has only increased 4 to 5 million barrels per day, according to The Energy Intelligence Group.

The IEA also changed its stance in its July report, saying China's oil demand is mainly a product of its own economic growth and not favorably low prices. In fact, China's demand is already suppressed by global supplies..

The agency predicts China's annual demand for oil will account for one third of the whole world within the next years. Unless global oil producing countries can increase output, China may once again become the scapegoat for supply and demand economics.