China’s surge in oil purchases could be losing momentum

China’s Oil Import Trends Amid Rising Prices

Despite ongoing discussions about a slowdown in oil consumption, China set another record for crude imports last year. The nation, recognized as the world’s largest oil importer, has maintained a high pace of crude purchases into this year. However, with oil prices continuing to climb, this trend could soon shift.

Brent crude has remained near $70 per barrel for over a week, with market sentiment more optimistic than late 2025 forecasts, which did not anticipate recent geopolitical events and their impact on supply security. While China is less affected by global oil prices than India, it still responds to price changes and has accumulated significant crude reserves.

Record Imports and Strategic Stockpiling

In 2025, China’s crude imports averaged 11.55 million barrels per day, marking a 4.4% rise from the previous year. Not all of this oil was processed; a substantial portion was stored. According to Frederic Lasserre of Gunvor, from March 2025, China began stockpiling at an impressive rate—nearly one million barrels daily.

Beyond increasing its reserves, China has been expanding its storage infrastructure, constructing 11 new facilities with a combined capacity of up to 169 million barrels. Some analysts speculated that this buildup was in preparation for potential tensions over Taiwan, but so far, such theories remain unconfirmed.

China’s Buying Patterns and Market Dynamics

China’s approach to oil imports is straightforward: it increases purchases when prices are low and scales back when costs rise—a typical strategy for any major commodity importer. As the largest player in the market, China’s actions draw significant attention. Last year, oil prices were depressed due to widespread belief in a supply glut, leading traders to overlook geopolitical risks. This year, with geopolitical tensions rising and the IEA revising its outlook, oil prices have surged, and Chinese buyers are beginning to feel the impact.

Surge in Russian Oil Imports

Recent reports indicate that Chinese refiners and traders have been purchasing record volumes of Russian crude. In February, imports averaged nearly 2.1 million barrels per day, up from 1.7 million in January, as Indian refiners reduced their Russian oil purchases under U.S. pressure. This shift has led to even steeper discounts on Russian crude, benefiting Chinese buyers.

Discounts from Other Suppliers and Changing Import Patterns

It’s not just Russian oil seeing price cuts. Sellers from Angola and Nigeria have also lowered their prices, with discounts on local crude widening from $3 to $5 below Dated Brent in February. This could signal a slowdown in China’s oil imports starting in April, especially as higher shipping costs reduce demand for West African and Middle Eastern oil.

Data from Kpler shows that China’s crude imports from Nigeria and Angola are expected to drop to 1.04 million barrels per day in March, down from 1.25 million in the last quarter of the previous year. Further declines are projected for April, with imports potentially falling to 978,000 barrels daily.

Shipping Costs and Middle Eastern Oil

Freight rates for supertankers transporting crude from the Middle East to China have soared to their highest levels in six years, driven by increased Persian Gulf exports to India and efforts to expedite shipments ahead of possible U.S. military action in Iran. The daily cost of chartering a very large crude carrier has reached up to $170,000, tripling since early 2026. In response, Middle Eastern suppliers have also reduced their prices.

Saudi Arabia, for instance, has cut its official selling price for Arab Light to its lowest since December 2020, marking the fourth consecutive monthly reduction. For March, Arab Light is priced in line with the Dubai/Oman benchmark, and traders expect Saudi oil exports to China to reach 56–57 million barrels, up from 48 million in February.

China’s Influence on Global Oil Markets

The combination of price discounts, shifting demand from Chinese buyers, and analysts’ forecasts for the coming months underscores that, despite speculation about declining demand, China continues to play a pivotal role in shaping prices for the world’s most traded commodity.

By Irina Slav for Oilprice.com

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