Abstract: For a deeper understanding of China's oil production situation, it is necessary to investigate the composition of the reserves-production system and its changes, especially the proved developed estimated ultimate recovery (Proved Development EUR) and the corresponding Proved Developed Reserves and production in large oil fields or basins. The study results indicate that China has almost achieved the goal of the second round of oil and gas exploration, and the Proved Developed Reserves and production began declining. To keep sustainable and stable production, it is necessary to tap the potential of old oilfields, and more importantly, to find strategic replacement in new areas. Such new areas include deep strata in large basins, offshore Pre-Cenozoic marine strata, the Tibetan Plateau, and the Upper Paleozoic of the "Southern Intercontinental Zone of Central Asia" in northern China. In addition to technical challenges, oil and gas exploration and production are currently suffering the impacts from insufficient investment and slow progress in institutional reforms.

Key words: crude oil, oil and gas production situation, reserves-production system, oil tactic and strategic replacement, institutional reform