China's oil stockpile cushions global prices before Xi's Washington visit next week

September 19, 2026 at 08:00 PM2 min

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China's strategic oil reserve of about 1.4 billion barrels has helped soften global oil prices during the six-month Iran conflict. President Xi Jinping is set to visit Washington next week amid pressure on Trump over high gasoline prices.

Key Facts

China's strategic oil reserve reached about 1.4 billion barrels by the end of last year, according to U.S. Energy Information Administration estimates.
China is the world's second-biggest oil consumer and Iran's top buyer.
President Xi Jinping is making a state visit to Washington next week.
Attacks by Iran-backed militias this month led Saudi Arabia to temporarily shut a vital pipeline to Red Sea ports.

China's Strategic Reserve

Beijing spent years and billions of dollars amassing the world's largest oil stockpile, building its strategic reserve to about 1.4 billion barrels by the end of last year, according to the U.S. Energy Information Administration's estimates. To protect China from foreign supply risks, Xi made energy self-reliance a part of the country's latest five-year plan. Drawing from the massive stockpile allowed China, the world's second-biggest oil consumer and Iran's top buyer, to dramatically cut crude imports once the U.S. and Israel began their bombardment and Tehran effectively closed the Strait of Hormuz. The country was also helped by its shift toward electric vehicles in recent years and increasingly tapping into other energy alternatives.

Global Price Impact

China's oil import diet in turn helped ease global demand, softening the upward price effects for the United States, Europe and beyond. Retired U.S. Navy Rear Adm. Mark Montgomery, an analyst at the Foundation for Defense of Democracies, said the Chinese deserve credit. Montgomery noted that China did in 10 years what took the United States 25 years after the 1973 oil crisis to do: build a strategic petroleum reserve that could allow weathering such a situation. Rosemary Kelanic, director of the Middle East program at Defense Priorities, said the world has been free-riding off Beijing in a weird way.

Xi's Washington Visit

Chinese President Xi Jinping is making a much-anticipated state visit to Washington next week. It is unclear how much the two leaders will discuss Iran during the visit, which comes as Trump's Republican Party faces pressure from voters over high gasoline prices. Trump, who has sought to keep a fragile trade truce with Beijing intact, has been careful in public comments about differences with Xi over the country's relationship with Iran. Attacks by Iran-backed militias this month led Saudi Arabia to temporarily shut a vital pipeline that transports crude across the kingdom to ports on the Red Sea.