China's Secret Oil Play Keeps Prices in Check

The ongoing Iran war has led to predictions of catastrophic oil prices, but so far, global prices have risen only slightly. The Strait of Hormuz saw the passage of 20 million barrels of oil a day, a fifth of the world's total supply.

However, China's unexpected reduction in oil imports has freed up those barrels to go elsewhere, preventing a shortage and keeping prices low. Before the war, China was buying more barrels than the entire European continent and almost twice as much as the second-largest importer, the United States.

The country abruptly slashed its oil purchases, cutting them by half compared with prewar levels. This reduction in demand has given rise to several theories about how China managed to meet its energy needs while forgoing imports.