Abstract: From the perspective of administrative monopoly, this paper examines the institutional and policy changes of China’s petroleum industry and finds out the root of such problems being the lower production efficiency of the oil industry and frequent shortage of refined oil, etc.. By using the data envelopment analysis method to measure the industrial and regional efficiency of the oil industry from the quantitative point of view, it confirms that the scale inefficiency of the oil industry has led to the loss of overall efficiency of the oil industry. The administrative monopoly has limited the development scale of China’s small and medium-sized oil companies to some extent, leading to some invalid scales. The key to improve the efficiency of China’s oil industry lies in such measures as canceling the government function of the two big oil groups, introducing the competitive system, and giving full play to the market.

Key words: oil industry; administrative?monopoly;?DEA;?overall efficiency; scale?efficiency