The nation's annual crude oil demand may rise to about 550 million tons by 2020, or an incredible 11 million barrels a day.

This compares with last year's 320 million tons, China's top energy researcher said yesterday in Shanghai.

"My estimate is a bit higher than the projection made by our government but lower than the figure projected by International Energy Agency," Han Wenke, director general of the Energy Research Institute under the National Development and Reform Commission, told an industry conference.

The central government has a 2020 estimate of somewhere between 450 million tons and 500 million tons, which Han said is too conservative.

The forecast of 600 million tons by Paris-based IEA is inaccurate as the oil policy advisory has overestimated China's transport fuel use, according to Han.

"They (the IEA) may have reached their 600-million-ton forecast out of the potential growing auto ownership in China," Han said. "But China is using its railroad network to reduce nationwide logistics costs and encourage public transport in major cities.

"The auto sector is growing fast, but China has also turned to diversification as its priority in securing energy supply."

Han said China may be able to produce a total amount of crude oil of between 146.3 million tons and 187.5 million tons in 2020, against 183.7 million tons last year.

The flat or even lower production volume forecast for 2020 could add pressure on China, indicating it has to rely more on imports.

China's net crude imports hit a record high of 3.48 million barrels a day last month, beating the previous record of 3.25 million barrels a day set last September.

Hong Kong-based brokerage CLSA Ltd said this "indicated strengthening Chinese demand."

Han added that by 2010 China's crude demand will grow quite fast. Crude needs may reach 400 million tons, or even 440 million tons, by the end of the decade.