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world3h ago
Why China can withstand oil's surge past $100 more easily than other countries
- Oil prices surge after Iran-related tensions, but China may be less affected due to massive crude stockpiles.
- China’s stockpiles amount to about 1.2 billion barrels of onshore crude by January, equating to several months of demand.
- China now relies on the Strait of Hormuz for 40–50% of its seaborne imports, a share shrinking with overland routes and diversification.
- By 2030, China targets 25% non-fossil fuels in total energy consumption, up from 21.7% in 2025.
- Analysts see China's electrification of transport and renewables as a hedge against oil shocks.
- Renewables already fuel a growing share of China’s energy, while coal remains dominant but stable.
- China’s electric vehicle push has displaced over 1 million barrels per day of implied oil demand.
- Iran accounted for about 20% of China's oil imports, though this could be offset by other suppliers.
- The risk lies in about 5 million barrels per day of Chinese oil imports from other Middle Eastern countries via Hormuz.
- Analysts expect China to expand strategic stockpiles by about 1 million barrels a day in 2026.
- Despite demand shifts, China’s crude imports rose 4.6% to a record in 2024 as tensions simmered.
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