How China manages oil supply shortages

Oil prices remained relatively stable despite a US-Iran war shock, with Brent exceeding $126 per barrel in late April 2026 before settling at $100-110 in May. China reduced imports to under 8 million barrels daily and drew from strategic reserves, while Saudi Arabia rerouted shipments via the Suez route. However, this stability is temporary, relying on demand reduction and inventory drawdowns rather than alternative supplies.

The current stability is temporary and fragile, based on falling demand and inventory drawdowns rather than alternative supplies.