This paper firstly summarizes the four basic understandings on which China’s oil strategy and policy making are based. Then it points out that under the new situation of the current domestic and international oil industry and Chinese new normal economy，many institutional advantages，that have been considered to be “Chinese characteristics”，are facing tremendous challenges from concept to practice. It suggests that Chinese government must reflect on the four basic understandings and positively and timely adjusts its energy strategy，diplomatic policies and the view of national energy security. Subsequently，it reviews China’s oil policies in 2014 focusing on the five domains-energy strategy，government regulation，oil finance，and reforms of taxes on oil and on central government-led oil companies-and makes further analysis according to the suggestion.