Why China can withstand oil's surge past $100 more easily than other countries

CNBC reports that surging oil prices after the Iran war—pushing oil past $100 a barrel for the first time in four years—are expected to hit China less severely than in prior episodes because the country has built large crude stockpiles and diversified its energy sources.

“BEIJING — Surging oil prices following the Iran war are expected to impact China less than in past years as the country has built large crude stockpiles and diversified its energy sources, including renewables”

CNBC

OCBC analysts said China may be "less sensitive to a prolonged closure of the Strait of Hormuz than many of its Asian peers."

CNBC

China held an estimated 1.2 billion barrels of onshore crude stockpiles as of January, equal to about three to four months of reserves, the article says.

Rush Doshi, director of the China Strategy Initiative at the Council on Foreign Relations, noted China now relies on the Strait of Hormuz for only about 40% to 50% of its seaborne oil imports after two decades of reducing dependence on maritime oil flows.

Kpler reported that about 31% of the world's seaborne oil flowed through the strait last year—around 13 million barrels a day.

As the Iran war enters its second week, it remains unclear when the conflict will end, the article adds.

CNBC outlines China’s ongoing energy transition as a structural hedge against oil shocks.

“BEIJING — Surging oil prices following the Iran war are expected to impact China less than in past years as the country has built large crude stockpiles and diversified its energy sources, including renewables”

CNBC

By 2030 China aims to raise non-fossil fuels to 25% of total energy consumption from 21.7% in 2025.

CNBC calculations based on IEA data show renewables excluding nuclear and hydropower made up 1.2% of China’s total energy consumption in 2023, up from 0.2% two decades earlier.

CNBC also reports that more than half of China’s new passenger vehicles sold are new-energy vehicles.

Rhodium Group said in July 2025 that China’s electric-vehicle push, particularly in trucks, had already displaced over 1 million barrels per day of implied oil demand and expected that displacement to rise by about 600,000 barrels per day over the following 12 months.

CNBC's piece also notes that oil and natural gas accounted for only 4% of China’s power mix.

Ember reported that renewables supplied about 80% of China’s new electric power demand in 2024.

Ano Kuhanathan, Head of Corporate Research at Allianz Trade, said Iran supplied about 20% of China’s oil imports but much of that volume could be replaced by increased imports from Russia, while the larger risk is roughly 5 million barrels per day that China imports from other Middle Eastern countries via the Strait of Hormuz.

Nomura’s chief China economist Ting Lu said shipments through the strait represent 6.6% of China’s overall energy consumption and natural gas imports through the route account for another 0.6%.

CNBC

Analysts and firms quoted in the story described China as "materially exposed but more flexible" (Kpler’s Go Katayama) and noted structural obstacles such as state-owned fossil-fuel firms and the slow nature of change.

The U.S. Energy Information Administration expects China to expand strategic stockpiles by about 1 million barrels a day in 2026.

The article notes uncertainty over the war’s duration and says a shock would likely reinforce China’s existing direction toward electrification and decarbonisation, according to Ember’s Muyi Yang.