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Indeed, imports are for filling their ~1.3B barrel strategic reserve at favorable sanctioned priced imports. https://www.reuters.com/business/energy/china-targ

• JumpCrisscross 7mo ago
  > Indeed, for filling their ~1.3B barrel strategic reserve That's 117 days, or four months, of imports [1]. Half of Hormuz-transiting oil ends up in China [2]. So even if China fully substitutes lost imports with reserves, that's not even taking them through the end of the year. (And China running down its reserves is a strategic win for America. It means they aren't available to buffer a blockade of the Straits of Malacca.) I don't even know of a credible economist in China arguing China is insulated from this shock. [1] https://www.eia.gov/todayinenergy/detail.php?id=64544#:~:text=China%2C%20the%20world%E2%80%99s,while%20others%20decreased. https://www.eia.gov/todayinenergy/detail.php?id=64544#:~:tex... [2] https://www.visualcapitalist.com/charted-oil-trade-through-the-strait-of-hormuz-by-country/ https://www.visualcapitalist.com/charted-oil-trade-through-t...
  • toomuchtodo 7mo ago
    China’s Edge in an Oil Shock: Electric Cars and Renewables - https://www.nytimes.com/2026/03/14/business/china-oil-cars.html https://www.nytimes.com/2026/03/14/business/china-oil-cars.h... | https://archive.today/UBP8L https://archive.today/UBP8L - March 16th, 2026 Implications of the Conflict in the Middle East for China’s Energy Security - https://www.energypolicy.columbia.edu/implications-of-the-conflict-in-the-middle-east-for-chinas-energy-security/ https://www.energypolicy.columbia.edu/implications-of-the-co... - March 4th, 2026 Ember Energy: China - https://ember-energy.org/countries-and-regions/china/ https://ember-energy.org/countries-and-regions/china/ - February 2026 China’s LNG imports were dropping before this crisis. China’s LNG imports fell 12% in 2025 despite remaining world’s top buyer - https://www.icis.com/explore/resources/news/2025/12/30/11168190/analysis-china-s-lng-imports-fell-12-in-2025-despite-remaining-world-s-top-buyer/ https://www.icis.com/explore/resources/news/2025/12/30/11168... - December 30th, 2025 (I agree there will be some pain, but argue that China has sufficiently prepared for a fossil supply chain disruption of this magnitude, while also having the industrial state capacity to achieve a more favorable long term trajectory; they are deploying ~400GW+ of renewables annually at current deployment rates)
    • JumpCrisscross 7mo ago
      > argue that China has sufficiently prepared for a fossil supply chain disruption of this magnitude Where we agree is in China having massively reduced the impact of this shock. (And, probably, in them succeeding in insulating themselves completely within a generation.) Where we don't is in this still being a stagflationary hit to China and, probably, a worse economic hit to them than it will be to us. Put more succinctly, the first and second derivatives are massively favourable. But the actual level still produces lots of vulnerability. China will be better off than its neighbours. But it's still going to get screwed even if the war ends tomorrow, which it isn't.
  • maxglute 7mo ago
    PRC coal to petchem is like 3mbd equivalent (growing at 500k mbd per year), profitable vs oil at $80, ergo about 3/5 of their industrial feedstock inputs just got massive 50% and growing discount vs everyone else. Plastics, synthetics, fertilizer... everything PRC now has structural 50% discount. For actual Hormuz, PRC gets 6/12mbd. They really only need ~8m for domestic use, other 4m is discretionary, i.e. reselling refined petro/petchem or heating, stuff which can be forgone without degrading domestic operations or rapidly electrified. So really PRC only dealing with 2mbd import shortfall if Hormuz fully closed, their SPR will stretch for couple years at current runway if they just forgo discretionary oil use, and by the time it empties, if PRC goes ham on domestic EV / freight at current adoption, with active coal to X in pipeline, they can displace another that 2m barrels. Only way for PRC SPR to run dry end of year is if US starts blockading Malacca tomorrow and glass pipelines. Otherwise PRC on trend to survive with massive advantage vs everyone else. Energy geopolitics to consider is unless Hormuz shuts down completely by Iran (or US), PRC gets first dibs on energy products by default, all existing contracts are going to be force majeured, and only way any GCC producer is going to make money is by selling to PRC first if Iran serious and can enforce petro-yuan. Also with 20% energy mix from oil vs 40% from US, and electric freight options for logistics, PRC simply better setup to weather high energy prices and disruptions. Their coal petchem stack = they are now permanently cheaper than all other (oil/naphtha based) industrial competitors who bluntly can't even pull the overproduction card vs PRC because their production will crater from lack of of inputs creating condition to reinforce PRC as primary global producer. No one can outproduce PRC in high oil scenario because no one has PRC price stable coal to liquid/chemical stack that serves as energy fortress that decouples most of PRC economy/industry from oil prices. TLDR, PRC is relatively derisked from Hormuz already, if US wants to actually snowball oil disruption into advantage vs PRC, they need to start war with PRC right now. Otherwise sustained high oil price going to be net positive for PRC vs basically everyone else.
    • JumpCrisscross 7mo ago
      > if they just forgo discretionary oil use You're describing economic damage. > which can be forgone without degrading domestic operations or rapidly electrified I've heard this line from geopolitical analysts, mostly outside China. And then I hear from economists and traders in China, or look at its stock market [1], and see them preparing for a shock. A shock that's been softened by Beijing's policies. But not eliminated. > unless Hormuz shuts down completely by Iran (or US), PRC gets first dibs on energy products by default This is far from certain. Right now, Iran has a veto on Hormuz traffic and is throttling it, including for China-bound traffic. Long term, I think we realise every Hormuz neighbour has an off switch. Why a waning customer would get "first dibs...by default" will require more explanation from you. > sustained high oil price going to be net positive for PRC vs basically everyone else I'm not seeing it. Inputs going up in price is still worse than not. Russia is winning. Non-Gulf oil exporters are winning. And China is relatively winning within Asia. But globally, it's still weaning a risk that's been known for decades. [1] https://tradingeconomics.com/china/stock-market https://tradingeconomics.com/china/stock-market