Finance · Hometown Post
China has strengthened its position as the ultimate swing buyer on the global oil market, surpassing OPEC’s influence. Igor Sechin, CEO of Rosneft, stated that China has transformed from a major consumer and importer into an active market leader. This year, China took the initiative from OPEC by reducing crude oil imports by about 5.5 million barrels per day (bpd), stabilizing the market without joining any cartels.
Before the Iran war, China had accumulated up to 1.4 billion barrels of crude in commercial and strategic stockpiles, allowing it to cut imports when the Strait of Hormuz closed, causing price spikes. During the Middle East crisis, China withdrew from the spot market and reduced import demand, offsetting lost supply. The market initially underestimated China’s flexibility, which led to a 40% reduction in June compared to pre-war levels.
Additionally, China has seen a surge in electric vehicle (EV) use, a shift to coal, and increased renewable energy in power generation. Sechin believes further growth in China’s strategic and commercial reserves will strengthen its role in the energy market, as OPEC’s influence wanes due to the departure of members like the United Arab Emirates.
Source: OilPrice.com
