China started tapping its vast oil stockpiles in May, signaling that Beijing continues to resist paying premium prices for prompt crude cargoes amid an enduring Middle East crisis. Energy consultants and tracking firms Energy Aspects, Kpler, and Vortexa estimate the country will draw an average of roughly 1 million barrels per day over the next several months, according to Bloomberg.
The move comes after the regional conflict removed an estimated 10% of global supply, pushing spot prices higher. By leaning on its strategic reserves rather than increasing spot purchases, Beijing is effectively managing its import costs while securing near-term supply stability. China is the world's largest crude importer, giving its buying patterns outsized influence on global markets.
Beijing has built one of the largest strategic petroleum reserve systems globally, though exact capacity figures remain opaque. The drawdown rate of 1 million bpd suggests significant inventory depth, allowing China to sustain these releases for months without depleting emergency buffers. This approach mirrors tactics used during prior price spikes, when stockpile releases helped cap spot premiums.
The Middle East crisis has disrupted key shipping routes and production hubs, with the conflict now in its fourth month. While China draws from its reserves, OPEC+ producers face pressure to adjust output quotas to compensate for lost supply. Any sustained drawdown by Beijing could tighten the physical market further, as the reserves were intended for emergency disruptions—not routine price management.
Some analysts warn that relying on stockpile releases rather than market purchases could backfire if the conflict escalates or supply outages widen. Once reserves are drawn down, China would have less of a cushion against future shocks, potentially exposing it to even sharper price spikes. The International Energy Agency has cautioned that strategic stockpiles should be preserved for genuine emergencies rather than used as a price-control tool.