China’s oil import cuts nearly equal Asia’s supply loss from Iran war

August 10, 2026 at 08:18 AM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

China’s crude imports averaged 7.78 million barrels per day in June and July, a decline of 4.21 million bpd from pre-war levels, effectively absorbing nearly all of Asia’s supply loss caused by the Iran conflict. This has allowed other Asian buyers to avoid severe cutbacks, even as total regional imports remain 4 million bpd below levels before the Strait of Hormuz closure.

China’s Import Collapse

China imported 8.41 million barrels per day in July, up from June’s near-decade low of 7.12 million bpd, according to Reuters. The combined June–July average of 7.78 million bpd is 4.21 million bpd lower than the 11.99 million bpd imported in the three months before the US–Israel attack on Iran on February 28. This drop accounts for the overwhelming share of Asia’s demand reduction, as tracked by commodity analysts Kpler. China has also tapped strategic reserves, enabling it to prolong the import cuts without triggering fuel shortages domestically.

Middle East Supply Disruption

The Strait of Hormuz, which handled about 20% of global crude and product traffic before the war, has been effectively shut since late February. Saudi Arabia and the United Arab Emirates have increased shipments via ports outside the strait, but total Middle East crude exports remain roughly 5 million bpd below pre-conflict volumes. The vast majority of those barrels formerly went to Asian refiners, leaving the region structurally short.

Asia’s Market Strain

Total Asian crude imports reached 22.82 million bpd in July, a recovery from April’s eight-year low of 18.77 million bpd, but still about 4 million bpd below the pre-war average of 26.89 million bpd. China’s import cut of 4.21 million bpd almost singlehandedly covers the region’s shortfall. As a result, other major importers such as India, Japan, and South Korea have not been forced to make dramatic cuts. Nevertheless, the situation remains fragile, with market participants watching Chinese inventory drawdown rates closely.