China appears to continue sending crude into strategic and commercial reserves despite the plunge in its imports and the world’s biggest-ever supply shock.
China likely sent 430,000 barrels per day (bpd) of crude to reserves last month, according to estimates by Reuters columnist Clyde Russell based on official data about imports, refinery throughput, and domestic production.
Unlike the United States, China does not report inventories. Analysts are looking at overall supply (domestic production plus imports) and refinery processing rates to estimate how much crude is going into reserves and how much is being processed into fuels.
China’s crude oil imports slumped by 20%, or by 2.4 million barrels per day, in April from a year earlier. Imports were pegged by official data at 9.25 million bpd in April 2026, which was the lowest level since July 2022.
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Yet, refinery throughput was also at its lowest since August 2022 as China has reduced refinery utilization.
This likely led to oil stockpiling in April in China, which appears to be faring much better than other major importers amid the shock loss of supply from the Middle East.
Beijing is estimated to have been amassing crude into commercial and strategic inventories for a year—taking advantage of lower international prices and even lower prices for sanctioned supply out of Iran, Venezuela, and Russia.
As the Middle East crisis choked off supplies via the Strait of Hormuz, China has shown it is much more resilient to the supply shock than other regions and countries, including Europe, India, Japan, South Korea, or Southeast Asia, analysts say.
In April, instead of drawing down inventories, China kept building them, Emma Li, Lead China Oil Market Analyst at Vortexa, said earlier this month.
China was estimated to have grown its aboveground crude stocks to a record 1.24 billion barrels, with builds still running at around 580,000 bpd in April, per Vortexa data.
“Combined with the near 52mb accumulated since end-February, the signal is clear: refiners have adjusted faster—and more aggressively—than the supply shock itself,” Li said.
By Michael Kern for Oilprice.com
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