China is now a 10.2 Trillion economy // at the current growth rate of around 8%.. China will be about the same size as USA in 5 yrs
USA GDP is equivalent to 7 India.
China GDP is equivalent to 5 India.
If you're investing in Oil and Gas stocks especially in BPT.. this is great news to know that China will become the same size as United States in 5 yrs time. In 5 yrs from now, you going to have 2 United States in the World and this is great news for BPT.
The last 5 yrs,, United States GDP only grew by 1.2% on average after massive stimulus and QE implemented by the White House and The Federal Reserve. It's not likely the FED will stop their QE anytime soon knowing the US economy is still very fragile and very little growth. If FED take away the JUICE... US GDP can go into the RED and that's not going to be a recovery.
2 is always better than 1... China becoming the same size as United States is excellent news for BPT... in 5 yrs time, we going to have 2 United States consuming tons of crude oil and gas.
Size of an economy does not equate to oil consumption. It probably will and its not a bad thing for BPT. I'm just saying that its no guarantee that oil will rise in price.
Case in point... the U.S. is starting to drown in oil production of its own.
Some people will say what if China growth rate doesn't sustain around 7.5%-8% in the next 5 yrs.
I could tell you right now.. growth rate of 7.5%-8% is almost guaranteed for the next 5 yrs .. why ????
because China doesn't allow growth rate at 5%-6%.. these type of growth rate could lead to social disorder due to high unemployment. .. Remember the 2008/2009 US Stock Market Crash and dragged the whole world into the abyss ?
China Growth Rate when from double digit to below 6% and keeps falling.. the chinese government stepped in right away and did a massive stimulus $$$$$$.. What you seeing now in 2013.. China growing around 7.8% are based on mild water down stimulus. The Chinese government haven't committed any big stimulus for a long time.. but if growth rate somehow do fall below 6%, i can assure you China will throw tons of stimulus into their economy again. That's when you see the growth rate jump back to 8% or higher very quickly.