China’s Leader Appears to Be Taking Control of the Powerful Oil Sector

A worker rides a bicycle at an oil refinery of China's Sinopec, in Wuhan, central China's Hubei Province on May 10, 2011. (STR/AFP/Getty Images)

A number of high-profile leadership shakeups has swept China’s state oil conglomerates recently, with one top executive investigated and the heads of three national oil companies appointed in a single day—signs that Chinese leader Xi Jinping is consolidating control over the petroleum industry.

Wang Tianpu, president of Sinopec—the largest oil refiner in Asia—is being investigated for “serious violations of laws and discipline” (an official term referring to corruption), the Chinese Communist Party’s corruption watchdog committee announced on its website on April 27.

Wang is suspected of helping Zhou Bin, the eldest son of recently disgraced former Politburo member and security czar Zhou Yongkang, reap corrupt profits from the oil industry. He will almost certainly lose his job and be purged.

A week after the probe of Wang was announced, Chinese state-run media said that Sinopec chairman and Party secretary Fu Chengyu will retire and be replaced by Wang Yupu, a former oilman who was the vice-head of the Chinese Academy of Engineering at his last appointment.

Elsewhere, Wang Yilin, former chairman of the China National Offshore Oil Corporation, moved to the same role at the China National Petroleum Corp., while his vice-chairman Yang Hua took up his position. Wang is a common surname in China, and the men do not appear to have any familial relation.

Wang Yupu, Wang Yilin, and Yang Hua were all appointed on May 4.

Fu Chengyu and Wang Tianpu are known to be close associates of Zhou Yongkang, who made his first fortune in state oil. There, Zhou fostered an extensive network of cronies and connections, and maintained control over the sector as he advanced through the Party under the mentorship of former Party godfather Jiang Zemin.

While Chinese official media reports never state the fact, the anti-corruption investigations and the recent leadership shuffle point to one thing: Chinese leader Xi Jinping is steadily eroding the influence of Jiang Zemin and other rivals in the energy sector, and gaining control through appointing his own people.