China’s Oil Stockpile Cushions Prices Amid Iran Conflict

China's strategic petroleum reserve of about 1.4 billion barrels by the end of last year, per the U.S. Energy Information Administration, has helped keep oil prices below worst-case forecasts six months into a war President Donald Trump launched against Iran in late February. As the world's second-largest oil consumer and Iran's top crude buyer, China drew on stockpiles after U.S. and Israeli bombardment and Tehran's effective closure of the Strait of Hormuz. Brent crude averaged about $69 last year, peaked near $126 in late April, and hovers around $100. Bank of America forecasts $83 for the second half but sees $95 to $120 if violence escalates or up to $150 if major infrastructure is damaged. Rosemary Kelanic said, "We've been free-riding off Beijing in a weird way." Mark Montgomery said, "The Chinese deserve credit," and that China did in 10 years what took the United States 25 years after the 1973 oil crisis. Jonathan Czin called it "a vindication of Xi's last five-year plan and his focus on self-reliance." Xi made energy self-reliance part of China's latest five-year plan. Saudi Arabia this month temporarily shut a Red Sea pipeline after Iran-backed militia attacks; Houthis seized two southern Red Sea islands. The conflict has no end in sight and China's buffer is being tested.