Beijing, May 30, 2026 (Agencies) – China has been quietly cushioning the world from the full force of the Middle East oil crisis by drawing down its vast strategic reserves instead of competing in global markets — but analysts warn that buffer is running out fast, and when Beijing returns as a buyer, it could hit at the worst possible moment for global supply.
Chinese crude oil imports have collapsed to levels not seen in nearly a decade. Kpler, the commodity data firm, estimates China’s oil imports this month at 6.78 million barrels per day — a sharp drop from April’s 8.5 million barrels daily and far below last year’s average of 10.66 million barrels per day. To put that in perspective, China was storing roughly one million barrels per day above its consumption needs in 2025. It is now burning through that cushion at an accelerating pace.
The strategy has so far worked. By relying on stockpiles rather than fresh purchases, Chinese refiners have avoided adding fuel to an already burning global oil market rattled by the US-Israeli war with Iran. Refinery run rates in China are averaging 13.5 million barrels daily — down over 1.9 million barrels daily from 2025 levels — but domestic fuel consumption remains stubbornly resilient, meaning the gap between what China is importing and what it is consuming is being filled entirely by reserves.
Those reserves, once estimated at between 1.2 and 1.3 billion barrels, were seen as sufficient to last approximately four months. Rush Doshi, director of the China Strategy Initiative at the Council on Foreign Relations, told CNBC earlier this year that China had spent two decades deliberately reducing its dependence on maritime oil flows. That planning is now being tested in real time.
The problem is that the cushion is visibly shrinking. Kpler analyst Muyu Xu warned this week that some of China’s smaller independent refiners — known as teapots — have enough crude on hand only until early June. Once those stocks run dry, they will face a stark choice: buy expensive oil on the open market or cut production further. If teapots cut run rates, that frees up space for state-owned refiners — but those too face a severely limited range of suppliers.
China’s buying options have narrowed considerably. Beijing faces a retaliatory 22.5 percent tariff on US crude and restrictions on Venezuelan oil purchases. Discounted Russian crude — the backbone of China’s sanctioned barrel strategy — is also becoming scarcer. A US sanctions waiver covering Russian oil only applies to cargoes loaded before April 17, which Kpler’s Muyu noted is set to expire around mid-June. On top of this, India is competing intensely for the same Russian barrels covered by the waiver, further squeezing Chinese refiners’ choices.
What makes the timing particularly alarming is where global supply is headed. The International Energy Agency has warned that the worst of the Middle East supply crisis could hit in July or August, with its secretary-general describing that window as “the red zone” for oil supply. If Chinese buyers are forced back into global markets just as Middle East disruptions peak, the resulting demand surge could trigger a sharp and potentially severe correction in crude prices — one that markets, already stretched by the war, may be ill-equipped to absorb.
For Beijing, the calculus is straightforward and uncomfortable. It cannot allow its strategic reserves to fall to dangerously low levels — that would be an unacceptable vulnerability for a government that has spent decades building energy security. But re-entering the market aggressively means paying prices far higher than before the war, at precisely the moment when supply is tightest and competition is fiercest.
The world has benefited quietly from China sitting on the sidelines. That may not last much longer.