China’s import cuts anchor global oil markets amid Hormuz crisis, S&P Global says

China has emerged as the single most influential force shaping global oil prices during the Strait of Hormuz crisis, leveraging its massive crude inventories to slash seaborne imports and absorb the shock of lost Persian Gulf supply, according to new analysis from S&P Global ↗ 0.73% Energy published this week.

The Swing Buyer

The S&P Global Energy Crude Oil Markets team identified China as "the key oil market swing buyer" throughout what it called an "extraordinary" year for oil. Since May, China has reduced seaborne crude imports by five million barrels per day, or 45 percent, acting as a "demand-side shock absorber" that helped offset lost Persian Gulf barrels and contain prices.rigzone

Jim Burkhard, Vice President and Global Head of Crude Oil Research at S&P Global Energy, warned that "when, and at what pace, China resumes buying is a variable that will shape the trajectory of oil prices." He added: "The same factor that capped prices could quickly amplify them."rigzone

The U.S. Energy Information Administration confirmed in late July that China imported just 8.1 million barrels per day of crude in the second quarter of 2026, a 32 percent decline from the previous quarter. S&P Global estimates Chinese oil demand fell by 1.6 million barrels per day year over year in Q2 — far less than the import decline — with approximately 1.5 billion barrels in crude inventories enabling the country to sustain consumption through commercial drawdowns.eia+1

Markets Begin to Tighten

Goldman Sachs The Goldman Sachs Group, Inc. ↗ 0.68% analysts noted this week that the physical oil market is now tightening, with global visible stocks drawing by 6.3 million barrels per day over the last two weeks. Asia net imports of crude and condensate increased by 5.6 million barrels per day during that period, with China accounting for 2.3 million barrels per day of the pickup. Lower crude prices in late June and early July likely encouraged Asian buying, as higher Persian Gulf loadings translated into elevated imports with a time lag.rigzone

Oil prices have moved back into the $80-$100 per barrel range following the breakdown of the U.S.-Iran ceasefire, after swinging from $144.42 per barrel on April 7 to $69.35 on July 3.rigzone

Structural Shift Underneath

Beyond the cyclical import cuts, China's accelerating electric vehicle adoption has structurally reduced its oil dependency. During the first half of 2026, EVs displaced approximately 1.35 million barrels per day of oil consumption, equivalent to roughly 6 percent of China's annual crude imports. With electric vehicles accounting for around 55 percent of new vehicle sales in 2025 and heavy-duty electric trucks rapidly gaining market share, every barrel displaced permanently reduces China's exposure to maritime chokepoints.economies

As Burkhard put it: "The market's balance now depends heavily on a choice that Beijing can change. That is one reality that the Hormuz crisis has revealed."rigzone