{"id":731473,"date":"2026-06-12T07:13:13","date_gmt":"2026-06-12T07:13:13","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/731473\/"},"modified":"2026-06-12T07:13:13","modified_gmt":"2026-06-12T07:13:13","slug":"how-3-million-missing-oil-barrels-are-keeping-global-economy-afloat","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/731473\/","title":{"rendered":"How 3 million missing oil barrels are keeping global economy afloat"},"content":{"rendered":"

The world economy has been largely spared from skyrocketing fuel prices in part for a surprising reason \u2014 China has cut back its daily imports<\/a> by 3 million barrels of oil.<\/p>\n

After Iran shut down the Strait of Hormuz<\/a> in retaliation for the war, an export of at least 10 million barrels of oil a day from the Middle East were lost, with fuel prices soaring to a high of $126.41 as analysts warned for the worse. <\/p>\n

But prices are now hovering at around $90, well below what experts predicted, and the clues as to why the global market has been spared points to China\u2019s decision to reduce oil imports, the Wall Street Journal reported.<\/a><\/p>\n

China has dropped its oil imports from 10 million barrels a day to 7 million due to the war in Iran. AFP via Getty Images<\/p>\n

With no end in sight yet for the war in Iran, Saudi Arabia, the world\u2019s largest crude exporter, opted to hike the price of its Arab Light grade crude.<\/p>\n

Other nations followed suit to make up for the loss of exports due to the closure of the strait, which would leave China, the world\u2019s largest importer of Gulf crude, facing substantial costs. \u00a0<\/p>\n

Rather than pay up, China cut its imports from about 11 million barrels a day to around 7.7 million, according to Beijing\u2019s customs data. <\/p>\n

The massive drop in imports from China effectively kept the global oil supply from suffering the dramatic shocks experts predicted \u2014 along with the 2 million barrels of oil escaping the Strait of Hormuz<\/a> every day. <\/p>\n

Hundreds of ships remain stuck in the Persian Gulf as some ships slowly trickle through using shadow fleet tactics and paying Iranian tolls. REUTERS<\/p>\n

Despite the disruption, China has been able to carry on largely unaffected thanks to its vast inventories built up over the years from when it bought oil at discount prices from Iran, Russia and Venezuela. <\/p>\n

Emma Li, a China analyst at the Vortexa cargo and energy tracking company, noted that Beijing\u2019s reserves were so vast that the country could hold out until the end of the year at its current rate. <\/p>\n

\u201cBased on our calculation, even if the inventory drawdown rate picks up to more than one million barrels a day, China\u2019s commercial reserves alone are enough to sustain another six months,\u201d she told the Wall Street Journal. <\/p>\n

China\u2019s investments in high-speed electric railroads have helped decrease its dependence on oil. REUTERS<\/p>\n

Tensions remain high near the Strait of Hormuz as Iran and the US continue to exchange fire. AP Photo\/Amirhosein Khorgooi<\/p>\n

Part of the reason why China can afford to take a dip in oil imports is that its reliance on crude has dropped over the years thanks to their investments in electric vehicles<\/a> and high-speed railroads. <\/p>\n

Electric cars made up about a quarter of all vehicles on the road during China\u2019s May Day holiday week, which runs from May 1 to May 5, with 15.4 million EVs travelling every day, according to Beijing\u2019s Ministry of Transport. <\/p>\n

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That represents a 33% increase from last year, with rail travel in the same period increasing by nearly 5%, while air traffic fell by 5.7%. <\/p>\n

It remains to be seen what China\u2019s oil refiners will do in the event that crude oil futures and premiums on cargoes ease if peace is achieved in Iran.<\/p>\n

Should Beijing suddenly increase its imports, it risks tightening the market and raising global fuel prices.<\/p>\n

With Post wires<\/p>\n","protected":false},"excerpt":{"rendered":"The world economy has been largely spared from skyrocketing fuel prices in part for a surprising reason \u2014…\n","protected":false},"author":2,"featured_media":731474,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[45,49,48,95,46,5897,3241,9891,172000,883],"class_list":["post-731473","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-ca","tag-canada","tag-china","tag-economy","tag-iran","tag-oil","tag-oil-prices","tag-strait-of-hormuz","tag-world-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/731473","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=731473"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/731473\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/731474"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=731473"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=731473"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=731473"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}