For many years, China has made great strides in constructing a sizeable and stable energy supply system rooted mainly in domestic coal supply. That system, however, is subject to immense strain as a result of rapid economic growth, rising living standard, widespread environmental degradation, limited oil reserves and uneven resources distribution. Industrialization and urbanization since the early 1980s have imposed structural constraints on its traditional coal-based energy supply model. Eventually, China became a net oil-importer in 1993 when ten million tons of crude oil and petroleum products from abroad fed into the local economies of the coastal areas. Such a change meant that energy security has become an increasingly sensitive issue to the central government of China. This paper argues that China could benefit from a more open energy supply by striking to a balance of both domestic and international sources, rather than the traditional mode emphasized on a highly self-sufficiency rate.