Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTTsvetana ParaskovaFri, July 17, 2026 at 1:00 AM GMT+2 5 min readThe oil market may soon run out of the supply and demand cushions that have kept prices from soaring to record highs during the huge loss of flows through the Strait of Hormuz.The window provided by the U.S.-Iran memorandum of understanding, during which Middle Eastern producers rushed the crude amassed in the Gulf in the previous four months out of the region, abruptly shut down with the renewed hostilities and all-but-dead ceasefire.Inventories of crude and fuels in key markets, including the United States, are running dangerously low with no buffers left, while most of the oil from the world's biggest-ever coordinated stocks release has already reached refiners.Last but not least, China may soon end its absence from crude purchases and the decade-low crude oil import volumes from the past weeks, removing the single biggest demand buffer that capped oil price gains in March-June.The Return of China?China slashed its total crude oil imports to a decade low in June, culminating three months of very low import levels amid high prices and constrained supply from the Middle East. Beijing could afford to dramatically reduce its crude buying, slashing import volumes last month by an estimated 4.4 million barrels per day (bpd) compared to the 2025 average.Chinese imports of crude oil plunged by 41.3% in June from a year earlier, to just 29.27 million tons, or 7.12 million bpd, according to official Chinese customs data released on Tuesday.Related: Eni CEO: Big Oil Bets on Southeast Asia and Latin AmericaThe June volumes hit a decade low as they were at their lowest level since October 2016, according to the data series.China's huge stockpiles amassed before the Iran war began, and its ability to curtail imports during the first four months of the conflict has kept oil prices from spiking to record highs despite the loss of more than 10 million bpd of daily flows through Hormuz.China is the world's top crude importer, but it was also the importer best prepared to weather a global supply crisis. In the year before the Iran war started, China is estimated to have amassed between 1.2 billion and 1.3 billion barrels of oil in commercial and strategic reserves. These could be even higher as the inventories are a closely guarded secret, as are China's imminent plans about stockpiling or drawing down reserves.China may soon return to buying more oil as it has already started to tap reserves and wouldn't want to see the stockpile it had amassed run through too fast, too deep, analysts say.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info