China Using a Double-Insurance Strategy to Secure Crude Oil Supplies Amid Iran War

As the world's largest importer of crude oil, China has implemented a double-insurance strategy to safeguard its energy supplies amid escalating tensions in the Middle East, particularly the recent war involving Iran. This strategy combines two main elements: diversifying oil sources and maintaining extensive strategic stockpiles.

Following the closure of the Strait of Hormuz, a critical chokepoint for oil shipments, China faced potential supply vulnerabilities. Historically, about 70% of its crude oil needs have been imported, with a significant portion arriving from the Persian Gulf. In the wake of the intensified conflict, imports from Gulf states plummeted by 25% in March compared to the previous year. Despite this, China's overall crude imports declined only slightly, indicating the effectiveness of its strategy.

Chinese analysts noted that as imports from the Gulf diminished, China successfully turned to alternative sources like Russia, Brazil, and African nations. Reports indicate that crude imports from Russia saw an increase of 13% in March, while Brazil also shipped record amounts of oil to China.

The strategic reserves further bolster China's energy security. By the end of 2025, China had amassed nearly 1.4 billion barrels of crude stockpiles, ensuring the country can sustain itself amid international supply disruptions. This stockpile is significant, offering nearly 120 days of import coverage, which far exceeds the International Energy Agency's requirement.

As the conflict with Iran unfolds, experts emphasize that while the initial impacts may be manageable, prolonged disruptions could pose more formidable challenges. High global oil prices and tight supply conditions may require China to recalibrate its strategies continually. The dual approach of enhancing domestic storage capacities while seeking new import avenues allows China to navigate an uncertain global energy landscape effectively.

In summary, China's proactive measures and diverse sourcing strategies reflect a robust framework designed to mitigate risks associated with geopolitical crises, establishing a model that other energy-dependent nations may look to emulate.