China Has Not Escaped the Middle East. It Has Learned to Live with the Risk

The war with Iran appears to have reached its end, and the Strait of Hormuz is expected to reopen, despite Israel’s refusal to withdraw from Lebanon. The defeat of the United States—or, more precisely, of Donald Trump—raises many questions about the future of the region. However, it also provides an answer to an old question: can China secure the oil flows on which its economy still depends? The answer is less dramatic, but more important, than much of the commentary suggests. China has not volunteered to mediate between the warring parties. Nor has it expanded its military presence. Instead, it has turned a dangerous dependence into a managed vulnerability.

That distinction matters for both Chinese and Western policymakers. If the benchmark is energy independence, China has failed. It remains the world’s largest crude importer. More than 70% of its oil is imported, and roughly half of those imports are linked to the Middle East and the Strait of Hormuz. This is precisely the kind of narrow maritime chokepoint that Chinese strategists have worried about for decades. The current Iran war shows why those worries were justified. As Bassam Fattouh and Michal Meidan argue, the disruption of Hormuz is not just another oil-price shock. It has affected crude, refined products, LNG, fertilisers, metals and shipping. For Asia, the shock is particularly severe.

However, this event has also shown that China is less helpless than many assumed. In fact, it is enduring the crisis better than expected. This is because Beijing has long focused on diversification, stockpiling, domestic buffers, electrification and administrative control over demand and refining. In other words, while Chinese policymakers recognize energy as the ‘core’ of Sino-Middle Eastern relations as outlined in the ‘1+2+3’ framework of the 2015 China’s Arab Policy Paper, they have actively worked to ensure that dependence did not become captivity.

Indeed, China has spent years trying to avoid excessive dependence on any single supplier, route or fuel. As result of this, its relative reliance on Middle Eastern oil has long remained remarkably stable, at around half of total imports (Figure 1). That is high, but it is still far below the dependence of Japan or South Korea (Figure 1). China has diversified suppliers, buying more from Russia, Central Asia, Africa and Latin America. With regard to natural gas, domestic production is growing fast enough that, together with pipeline imports, China is now importing less LNG than it did in 2020.

Strategic Reserves

Beijing has also entered the crisis with 1.4 billion barrels of strategic oil reserves accumulated over many years, according to estimates made by the US Energy Information Administration. In 2025 alone, it added 1.1 million barrels per day thanks to the purchase of discounted Russian and Iranian crude and, more generally, low global prices. Hence, Chinese refiners today can process roughly twice what they are importing.

That said, the most interesting point is not just that China has massive stocks, but how carefully it is using them. As argued by Michal Meidan, Beijing is using a set of interdependent levers: refinery run cuts, yield management, commercial inventories, product export limits, domestic price controls and access to discounted crude. Meidan’s analysis suggests that, under a moderate 5% refinery run-cut scenario, China can broadly meet domestic gasoline and diesel demand if seaborne imports remain around 8 million barrels per day, though with trade-offs for petrochemicals. Under a deeper 10% run-cut scenario, imports could fall further, but only for a few months, because refiners would have to prioritise transport fuels at the expense of petrochemical feedstocks. Coal-to-chemicals can cushion the shock, but it cannot fully replace lost naphtha and LPG. According to Greggory Brew, China’s ability to intervene in, and either increase or reduce, its own oil demand is unprecedented and will play a key role in shaping the future of the global energy market.

Naturally, one also has to mention the massive and still growing electrification of the economy. For example, China’s fleet of electric trucks already displaced around 1 million barrels per day of oil demand, which is roughly equivalent to the daily oil production of Oman, in 2025. By 2030, this displacement is projected to reach 2.7 million barrels per day. This is strategically significant, particularly when combined with the continued decline in the energy intensity of the economy (Figure 3). While the electrification of the economy is often discussed as related to climate policy, it is also clearly driven by energy security concerns. The latest Five-Year Plan shows this well. On the one hand, it continues to support the ‘clean and efficient utilisation of fossil fuels’ and does not mention either a cap or peaking timeline for coal consumption. On the other hand, it clearly indicates that the green transition is a strategic priority as China’s solar power achieved cost parity with coal.

As such, while oil still dominates transport and petrochemicals, the combination of long-term planning and careful short-term intervention has meant that China did not have to treat the crisis as an emergency requiring supplies at any cost. The fact that the Chinese government has so far resisted releasing strategic petroleum reserves, while instead only greenlighting limited use of commercial stocks, is telling in this regard.

Against this background, Western policymakers should be careful. The common expectation that the need to protect the flow of oil and LNG would force Beijing to become a mediator or a security provider is too simplistic. Beijing has clearly chosen, and largely succeeded, in reducing the Middle East’s capacity to dictate China’s choices, rather than attempting to ‘solve’ the region’s problems.

For the UK and its partners, the policy implication is clear. They should not assume that Chinese energy vulnerability will make Beijing cooperative. Nor should they anticipate that Chinese resilience will make Beijing reckless. China’s energy strategy is designed to preserve as much foreign policy room for manoeuvre as possible. Hence, China will cooperate where its interests align: preventing a total collapse of Gulf energy flows, avoiding uncontrollable price spikes, keeping shipping routes open and limiting regional escalation. But it will resist, if not ignore, Western pressure when cooperation threatens its access to discounted sanctioned oil, its ties with Iran, or its broader effort to build financial and trading channels less exposed to US jurisdiction. Naturally, Beijing’s greater-than-expected resilience has implications also for a possible conflict in the Taiwan Strait, since blockading China has long been seen as a critical means to defeat it.

The uncomfortable lesson is that China’s energy security strategy is working better than many expected. Not because China has escaped dependence, and not because it can control the Gulf. It cannot. Another prolonged Hormuz closure would still hurt China badly. But Beijing has bought itself time, flexibility and bargaining room. That is no small achievement, and it will surely continue to build on this success. While China has not escaped the Middle East, it has learned to live with the risk and to make that risk less strategically decisive.

© Andrea Ghiselli, 2026, published by RUSI with permission of the author.

The views expressed in this Commentary are the author's, and do not represent those of RUSI or any other institution.

For terms of use, see Website Terms and Conditions of Use.

Have an idea for a Commentary you'd like to write for us? Send a short pitch to commentaries@rusi.org and we'll get back to you if it fits into our research interests. View full guidelines for contributors.