• China is preparing to tap commercial crude reserves to sustain refinery operations amid ongoing Middle East conflicts.
  • Drawdowns could reach up to 1 million barrels per day over the next 4-6 weeks, while strategic reserves remain untouched.
  • Beijing is implementing export curbs and refinery run cuts as precautionary measures to preserve stockpiles.

China is nearing a drawdown of its commercial crude oil stockpiles as the Middle East war continues to disrupt global energy markets, according to analysis from FGE NexantECA. The move, which could see drawdowns hit 1 million barrels per day for 4-6 weeks, aims to keep refineries running smoothly while avoiding taps on strategic reserves.

After heavy stockpiling in recent years, China holds about 1.4 billion barrels in total reserves, giving it significant room to act. "Efforts to maintain refinery output have hit a snag due to supply uncertainties," said one industry analyst familiar with the matter, who spoke on condition of anonymity. Early signs of disruption from Gulf supply issues remain limited, but analysts like Antoine Halff note that any impact may take time to reach China, prompting preemptive measures.

For now, Beijing is curbing fuel exports and trimming refinery runs as a precaution, trying to preserve stockpiles as long as possible. This aligns with broader trends of reduced exports and refinery cuts, which could ease pressure on international crude markets. The drawdown mitigates Gulf supply risks, stabilizing domestic refining amid global oil volatility from Middle East tensions.

Political context adds complexity, with Beijing prioritizing energy security through export curbs and avoiding strategic reserve taps. Escalating Middle East conflicts heighten U.S.-China energy trade tensions, particularly under President Trump's 2025 policies favoring domestic production. Refinery continuity supports fuel supply for Chinese consumers and industry, averting potential shortages and sparking debates on long-term import reliance.

Historically, China aggressively stockpiled post-2022 Ukraine crisis, building reserves against geopolitical shocks. Similar to 2019 Gulf tanker attacks, current Gulf issues prompt precautionary measures without immediate panic. In the short term, the 4-6 week drawdowns are expected to prevent outages but may tighten Asian spot markets. Long-term, experts predict delayed Gulf impacts on China, urging faster shifts toward renewable energy sources.

Related developments include India's reserve considerations and Europe's LNG stockpiling amid Red Sea disruptions, with recent news highlighting OPEC+ output hikes in response to Middle East risks. Attempts to reach FGE NexantECA for further comment were unsuccessful at the time of publication.

Correction: An earlier version of this article misstated the duration of potential drawdowns; it has been updated to reflect the 4-6 week timeframe.