China's Oil Reserve Buffer Contains Global Price Shock During Iran Conflict

China's strategic petroleum reserve played a crucial role in containing the global oil price shock during the Iran conflict. The country had built its stockpile to around 1.4 billion barrels by the end of last year, according to estimates from the US Energy Information Administration.

This buffer allowed China to reduce its dependence on fresh crude imports when the US and Israel began their bombardment and Iran closed the Strait of Hormuz. As a result, Chinese oil imports fell by 32% during the conflict.

The sharp reduction in Chinese demand eased global pressure on oil markets, with Brent crude averaging around $69 a barrel last year but hovering at over $100 in recent months. However, analysts warn that the market remains vulnerable to further disruptions.