China Holds Largest Oil Stockpiles As Prolonged Iran War Raises Fears Of Global Supply Shock: Report
China has sharply expanded its crude oil stockpiles over the past year, building what analysts describe as one of the largest energy buffers in modern history as the war involving Iran continues to destabilize global supply routes and push markets into sustained volatility.
The buildup comes at a moment when the Strait of Hormuz remains closed both by the U.S. and Iran,, leaving energy markets on edge worldwide. Disruptions in the region have already contributed to wild price swings and heightened concerns over broader energy security across the world, with International Energy Agency head Fatih Birol saying that the world is facing its biggest energy security threat in history.
China’s stockpiling strategy, which accelerated significantly throughout 2025, has given Beijing a substantial cushion against supply shocks. The country was estimated to have accumulated 1.4 billion barrels of crude by the end of last year, marking one of the highest reserve levels globally, according to estimates compiled from energy data analyzed in reporting by Axios.
That surge has positioned China as a uniquely insulated player in the current crisis, even as other major economies have been forced to draw down emergency reserves or coordinate strategic releases to stabilize markets.
Additional reporting by Reuters has documented continued flows of discounted crude from sanctioned producers into China despite global shipping instability, highlighting how independent Chinese refiners and state buyers have maintained import channels even under strained conditions.
At the same time, the conflict has driven renewed volatility in global oil benchmarks. Prices have repeatedly spiked during periods of heightened escalation in the Gulf, with traders reacting to both physical supply risks and geopolitical uncertainty.
China’s approach contrasts with Western economies that rely more heavily on shorter-term supply management mechanisms. The United States Strategic Petroleum Reserve, for instance, has seen fluctuations due to emergency drawdowns in response to global price spikes, while European countries have activated coordinated energy contingency frameworks following repeated disruptions linked to Middle East instability.
The war has also reshaped broader energy diplomacy. As tensions continue to escalate, countries dependent on imported crude have increasingly focused on diversification strategies, while major producers adjust output policies in response to market instability.
The International Energy Agency has previously warned that prolonged instability in the Strait of Hormuz could have cascading effects on global inflation and industrial output, particularly if shipping disruptions persist or expand. While no coordinated global shortage has emerged yet, the combination of military risk and market tightening has kept energy markets highly sensitive to developments in the region.
“As of today, we’ve lost 13 million barrels per day of oil … and there are major disruptions in vital commodities,” IEA head Fatih Birol told CNBC on Thursday.
