China Is Quietly Keeping World Oil Prices Lower - Newser

China has unexpectedly emerged as the world's primary bulwark against skyrocketing global oil prices, drastically curtailing its crude imports to an eight-year low of 7.8 million barrels per day in May 2026. This sharp reduction, a 29% year-over-year decline, comes despite the ongoing 'Iran war' and the effective closure of the Strait of Hormuz since early March, which has disrupted roughly 20% of global oil supply and triggered the largest energy shock in modern history. Beijing's strategic pivot has prevented Brent crude from soaring into triple-digit territory, a remarkable feat amidst profound geopolitical instability. The world's largest crude importer is navigating this crisis by aggressively drawing down its massive strategic and commercial petroleum reserves, estimated at up to 1.4 billion barrels at the end of 2025, which are the largest single-country stockpiles globally. Concurrently, China has slashed refinery run rates, particularly for its independent 'teapot' refiners, and curtailed fuel exports to prioritize domestic supply. These measures are bolstered by a significant structural shift in domestic energy consumption, notably the rapid adoption of electric vehicles, which now account for over 50% of new car sales and are projected to cut gasoline demand by 5.5% in 2026. However, this balancing act is inherently finite. Analysts warn that China's ability to indefinitely tap its reserves is limited, and a sustained closure of the Strait of Hormuz could force Beijing back into the market to replenish stockpiles, potentially sending oil prices significantly higher in the latter half of 2026. With major global inventories already being drawn down, including the impending conclusion of US Strategic Petroleum Reserve releases by late July, the market faces accelerated tightening, underscoring the precarious global energy outlook.