A drone view captures an Evergreen container ship docked at the port of Umm Qasr during nighttime operations in Basra, Iraq, on March 5, 2026.
BEIJING — As oil prices surge beyond $100 a barrel amid the ongoing Iran conflict, China is poised to experience less economic strain compared to previous years, thanks to its substantial crude stockpiles and diversified energy portfolio, which now includes renewables.
OCBC analysts have highlighted that China may exhibit a lower sensitivity to a prolonged closure of the Strait of Hormuz compared to many other Asian nations. "China has accumulated one of the world's largest strategic and commercial crude reserves," they noted, emphasizing the country's rapid shift towards electric vehicles and renewable energy as key factors providing a structural hedge.
As of January, China held an estimated 1.2 billion barrels of onshore crude stockpiles, sufficient to cover approximately three to four months of consumption. This buffer is expected to delay any immediate economic repercussions, according to Rush Doshi, director of the China Strategy Initiative at the Council on Foreign Relations, who spoke on CNBC's "Squawk Box Asia."
"Over the past 20 years, China has reduced its reliance on maritime oil flows," Doshi explained, citing new overland oil pipelines and a diversified energy mix that includes renewables. Currently, the Strait of Hormuz accounts for about 40% to 50% of China's seaborne oil imports.
Looking ahead to 2030, China aims to boost the share of non-fossil fuels in its total energy consumption to 25%, up from 21.7% in 2025.
The Strait of Hormuz, a key maritime chokepoint, connects the Persian Gulf to the Arabian Sea and global shipping routes. Approximately 31% of the world's seaborne oil passed through the strait last year, amounting to around 13 million barrels of crude daily, according to Kpler.
Despite this, oil transported through the strait makes up only 6.6% of China's total energy consumption, as per Nomura's chief China economist Ting Lu. Additionally, natural gas imports via this route contribute a mere 0.6%.
This energy diversification strategy reflects two decades of strategic planning, positioning China uniquely in global energy markets.