Why I call the below the most important story in markets / geopolitics?

1) without China importing far less, oil would be way, way above $100

2) Fed would be forced to hike rates, crashing Wall Street

3) President Trump would be against the clock in negotiations with Iran https://t.co/LEvdlkrLn4

— Javier Blas (@JavierBlas) June 4, 2026

Why the hell did the PRC decide to cut its crude oil imports in the last 30 days?

Did they "decide" or was the decision made for them?

The world is hitting tank‑bottom oil inventories by September.

Oil inventories work like blood in the human body: you can donate a bit, but below a certain level your blood pressure tanks and organs start failing. You don’t die because blood hits zero, you die because… pic.twitter.com/D6UXuQsuYj

— Lukas Ekwueme (@ekwufinance) June 4, 2026

Check to see how much they stockpiled before this all started.

https://www.axios.com/2026/04/23/china-oil-stockpile-iran-war

Regardless, it's helping keep oil prices lower. For once… good China?

flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

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The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

K2-HMFIC said:

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flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

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The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

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Twelve12 looks to have answered this at least partially. They stockpiled a ton before the war.

K2-HMFIC said:

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flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

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The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

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I imagine it is as simple as money. Their economics seem to be maybe more highly sensitive to oil prices than others and/or it was driven entirely by ultra cheap oil from VZ and Iran.

China was already hurting economically and now their input costs skyrocketed whilst global demand retracts as others absorb higher energy costs.

Some have said whether it was 4d chess by Trump or just a likely result but closing of the border, crackdown on fentanyl, shooting drug boats, removing Maduro and thumping Iran are all bad news for China.

flown-the-coop said:

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K2-HMFIC said:

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flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

---

The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

---

I imagine it is as simple as money. Their economics seem to be maybe more highly sensitive to oil prices than others and/or it was driven entirely by ultra cheap oil from VZ and Iran.

China was already hurting economically and now their input costs skyrocketed whilst global demand retracts as others absorb higher energy costs.

Some have said whether it was 4d chess by Trump or just a likely result but closing of the border, crackdown on fentanyl, shooting drug boats, removing Maduro and thumping Iran are all bad news for China.

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Wouldn't this make them more apt to continue importing?

Cutting off half of your energy supply, for a country that is obsessed with regime stability, seems…risky?

K2-HMFIC said:

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flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

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The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

---

I heard from colleagues in the oil industry that China stepped up their imports of black market Russian oil and chemicals because it is much cheaper than what's available on the global market. Helps both of them. I can't verify that, so take it fwiw.

China is an export economy so if the demand from the customers contracts (as they buy less due to higher energy costs at home) then China is squeezed by not being able to sell as much and what they can sell has higher input costs.

I am making that assumption but I would think it's an almost certainty.

And that's the 4D chess part. Could this tip China into "regime change". Can Lil Ping hang on? Will he try and leave some dynastic deity level legacy by taking Taiwan? Will he get toppled and who replaces him?

Regardless, all signs seem to point to a weakening China. That alone may be worth letting the SoH stay "closed".

To be clear, I'm speculating but it's worth the thinking.

MemphisAg1 said:

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K2-HMFIC said:

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flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

---

The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

---

I heard from colleagues in the oil industry that China stepped up their imports of black market Russian oil and chemicals because it is much cheaper than what's available on the global market. Helps both of them. I can't verify that, so take it fwiw.

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K2-HMFIC said:

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Why I call the below the most important story in markets / geopolitics?

1) without China importing far less, oil would be way, way above $100

2) Fed would be forced to hike rates, crashing Wall Street

3) President Trump would be against the clock in negotiations with Iran https://t.co/LEvdlkrLn4

— Javier Blas (@JavierBlas) June 4, 2026

Why the hell did the PRC decide to cut its crude oil imports in the last 30 days?

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I've skimmed this thread and haven't gone in depth on the various links, but some thoughts....

China didn't "decide" to import less oil. Keep in mind, import numbers will be upwards of 30 days or so behind when you account for tankers that had already exited SoH and were en-route.

Additionally China maintained a massive strategic reserve both in land based tanks and floating storage on aging tankers. They've been drawing down their reserves significantly since the Iran thing kicked off.

Yes they're building massive solar projects (this too along with new battery tech is pressing on silver demand as well) but they haven't materially changed their oil consumption with wind or solar since Israel/US vs. Iran kicked off.

This is all a reduction in Chinese imports from Iran and it's showing in the numbers as the last tankers from Iran have arrived.

EDIT to add... The Iranian oil that we cannot stop is what is moving through the Caspian Sea to Russia.

I would think that's an almost certainty. Even then, Russia has so much to share and risks political (and economic) consequences from doing so.

flown-the-coop said:

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I would think that's an almost certainty. Even then, Russia has so much to share and risks political (and economic) consequences from doing so.

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I'd be really curious to see how much is flowing thru the Caspian.

Do the Uke's need some more stuff to blow up? Haha.

I don't think we want more disruption and are okay with Russia doing some of this. If it becomes a problem then we can address it.

The Ukes doing it probably works out badly for them. Poking a bear whilst all your friends are tired and want you to leave bear alone is a dumb idea. But Zelensky is selfish and dumb so who knows.

BTKAG97 said:

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K2-HMFIC said:

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Why the hell did the PRC decide to cut its crude oil imports in the last 30 days?

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Did they decide to cut imports are were they forced to cut imports because they had no options to purchase oil?

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They likely decided to cut imports due to prices. They had no good options to purchase oil, so focused on their inventories.

BusterAg said:

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BTKAG97 said:

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K2-HMFIC said:

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Why the hell did the PRC decide to cut its crude oil imports in the last 30 days?

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Did they decide to cut imports are were they forced to cut imports because they had no options to purchase oil?

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They likely decided to cut imports due to prices. They had no good options to purchase oil, so focused on their inventories.

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And more specifically...they stockpiled early at better prices, and are now using that stockpile to offset lower imports which if they had continued at their previous pace would have pushed up the price even more than it is already given the drop in global stockpiles. They are basically trying to keep the cost of oil down to manageable levels as long as possible. We've got I'd guess another 3 months before SHTF in oil prices if nothing changes.

The obvious reason to me is it took some time for the last imports from Hormuz to come in and then get registered in the data. 35-50% of their oil came from Hormuz and a LOT of that from Iran.

I also look at any data from China with a cautious eye, especially reports of all of their "reserves". China has a total lockdown on information and they lie to themselves much less everyone else. People act like data coming from China is the same as if it came from any credible source. If you do ANYTHING in China that the government doesn't want you to do or talk about things they don't want you to (esp spreading information to the larger world) you are literally risking your life.

javajaws said:

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BusterAg said:

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BTKAG97 said:

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K2-HMFIC said:

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Why the hell did the PRC decide to cut its crude oil imports in the last 30 days?

---

Did they decide to cut imports are were they forced to cut imports because they had no options to purchase oil?

---

They likely decided to cut imports due to prices. They had no good options to purchase oil, so focused on their inventories.

---

And more specifically...they stockpiled early at better prices, and are now using that stockpile to offset lower imports which if they had continued at their previous pace would have pushed up the price even more than it is already given the drop in global stockpiles. They are basically trying to keep the cost of oil down to manageable levels as long as possible. We've got I'd guess another 3 months before SHTF in oil prices if nothing changes.

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To your point, China has done this playbook many times with various commodities. They have a government agency tasked with building up the equivalent of the SPR on steroids in various commodities that they import. With oil, they are essentially drawing down some of their SPR similar to what the Western Countries are doing including the US to dampen the increase in oil prices.

https://www.caixabankresearch.com/en/economics-markets/commodities/china-and-stockpiling-commodities-strategy-or-growth

K2-HMFIC said:

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flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

---

The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

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Are you guys for real?

They're importing less because they can't get any more. from venezuela and Iran now. This was Trump's plan. He put their nuts in a vice and decided to start really negotiating with President Xi wants he sees that Trump has far more control of oil/gas and now Greenland/Canada/US deposits of rare earth materials.

Nothing to add save this is a very edumicating thread.

That's all.

Carry on.

javajaws said:

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Did they "decide" or was the decision made for them?

The world is hitting tank‑bottom oil inventories by September.

Oil inventories work like blood in the human body: you can donate a bit, but below a certain level your blood pressure tanks and organs start failing. You don’t die because blood hits zero, you die because… pic.twitter.com/D6UXuQsuYj

— Lukas Ekwueme (@ekwufinance) June 4, 2026

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That's the right view...this aint their decision...

LMAO

Gloom and doom from the academics and global scientists that were against oil in the first place.

The good news, if they are right and we run out of oil in September….no more global warming!

Come September, the target will move to December.

This is so rich!

No Spin Ag said:

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Nothing to add save this is a very edumicating thread.

That's all.

Carry on.

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That F16 can OCCASIONALLY have civil content is something of a miracle haha

flown-the-coop said:

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The obvious answer is that they are no longer getting below market oil prices whilst funneling money to jihadists who want to kill us.

Beyond that… who cares?!

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You win a chicken dinner. The Chinese were trading their weapons systems for oil. That did not work well for IRAN.

all the people that have been clamoring to "end fossil fuels" for the past decade or two might finally get their wish!


i wonder if china's decreased imports has anything to do with difficulty getting imports from venezuela and iran?

oh no said:

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all the people that have been clamoring to "end fossil fuels" for the past decade or two might finally get their wish!


i wonder if china's decreased imports has anything to do with difficulty getting imports from venezuela and iran?

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The general consensus on the thread is that they are dipping into the strategic reserves and supplementing with black market Russian stuff rather than using the open market.

While that has had the effect of providing breathing room for the US, that runway seems to be coming to and end at some point (when is hard to say) soon.

twelve12twelve said:

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Check to see how much they stockpiled before this all started.

https://www.axios.com/2026/04/23/china-oil-stockpile-iran-war

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Wow. Almost as if China was stockpiling oil in advance of extracurricular activites.... Say, Tiawan?

Now wouldn't that be very interesting if this little excursion in the Hormuz Strait blew up Chinese plans for moving against Tiawan?

Not saying that's the case, but it is a plausible scenario.

K2-HMFIC said:

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flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

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The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

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How much of China's imports were either from Venezuela or from countries shipping through the Hormuz Strait? Shut those two spigots off, and what other options does China have to keep the oil flowing?

jrdaustin said:

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K2-HMFIC said:

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flown-the-coop said:

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Regardless, it's helping keep oil prices lower. For once… good China?

---

The CCP is not exactly an altruistic group…the why is an interesting question.

This has only started within the last 30 days…so a recent policy shift.

What changed?

---

How much of China's imports were either from Venezuela or from countries shipping through the Hormuz Strait? Shut those two spigots off, and what other options does China have to keep the oil flowing?

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Almost every other export country is an option. It is just a matter of price with some minor issues around crude quality and logistics. At this point, they are ok drawing down their ample reserves but the moment they think they need more imports, they will outbid a lot of poorer countries to get their necessary oil.

I don't know if this is a major factor, but I was in Chengdu, China, in April and was shocked by the number of electric vehicles. Pretty much every vehicle on the road seemed to be electric. It was kind of eerie being in the middle of such a huge city with streets packed with traffic, yet it was so quiet.