How China ensures energy security despite reliance on imported oil

Amid the energy shock caused by conflicts in the Middle East, China, despite its reliance on imported oil, has managed to absorb the energy market volatility, reporting robust economic growth backed by a diversified and resilient energy structure.

China reported a 5% increase in its gross domestic product (GDP) compared to a year earlier in the first quarter of 2026. This three-month period also saw better-than-anticipated growth in industrial and energy production, with the manufacturing sector up 6.4% and the production of electricity, heat, gas and water up 4.3%, according to official figures.

China imports most of its oil from other countries. Its $20 trillion economy relies on more than 70% imported oil, making the country the largest oil importer in the world. Yet the Strait of Hormuz, a choke point through which around 20% of global oil and gas trade passes, has remained mostly closed since the beginning of March.

The month-long disruption of the global energy market has put strain on economies in Asia and Europe, but China has so far managed to mitigate market volatility through its strategic reserves, diversified import sources, strengthened domestic energy output and rapid growth in non-fossil energy sources.

Strategic oil stockpile

While China has never officially disclosed the exact scale of its strategic oil stockpile, Jiang Bing, former chief of the National Energy Administration, told CMG on Friday that "the reserves are abundant."

The International Energy Agency suggests China has 1.2 billion barrels of crude oil in storage. According to Reuters, as of 2025, China's oil stockpile can keep the country running for at least four months, far exceeding the IEA's 90-day standard for oil reserves among its member countries.

China's preparations for its strategic petroleum reserves began in 2004 after the country rapidly expanded its oil imports to sustain its booming economy.

Diversity in sources of imports

China, unlike other major Asian economies, avoids relying on a single transport route or a single supplier for its oil imports.

For instance, China's pipeline network prevents it from relying entirely on seaborne imports. About 37% of crude exported from the Middle East heads to China, with Japan accounting for 12%, according to the IEA's latest oil market report. However, imports from the Middle East Gulf accounted for just over 50% of China's seaborne oil supply, according to the same IEA report, while Japan normally gets 90% of its petroleum imports through Hormuz, according to Asahi Shimbun.

Diversification of oil suppliers has also helped reduce China's reliance on a single region. Over the years, China has imported crude oil from 40 to 50 countries, according to China's General Administration of Customs, including Russia, Brazil, Canada, Angola, Colombia and Middle Eastern oil producers.

Boosting energy self-reliance

In 2019, China launched a seven-year plan to scale up exploration and extraction of its oil and gas reserves. The plan resulted in a steady annual crude output of more than 200 million tonnes (about 1.466 billion barrels).

China has also rapidly scaled up its shale oil extraction. Compared with 2018, shale oil output has increased eightfold, according to a report from China National Petroleum Corporation. This resulted in China producing 4.3 million barrels per day of oil in 2025, equivalent to 40% of the country's total imports.

The country's oil self-sufficiency rate remains a modest 20%, as its immense energy consumption makes complete oil self-reliance difficult to achieve. China's vast coal reserves, on the other hand, could be utilized by the country's world-leading coal chemical industry and serve as a pillar of China's energy security.

According to the National Bureau of Statistics, coal consumption accounted for 51.4% of the country's total energy consumption in 2025.

China has the world's fourth-largest coal reserves and hosts more than 80% of the world's coal chemical industry. The sector, which is almost unseen anywhere else in the world, can turn coal into oil, gas and chemicals used to produce polymers and fertilizers such as urea.

This sector converted 276 million tonnes of coal in 2024, according to the China National Petroleum and Chemical Planning Institute, and substituted 140 million tonnes of imported oil and gas.

A long-term shift to renewables

China has been vigorously pushing for a greener, less fossil-fuel-reliant energy framework to diversify its energy sources while also meeting the country's carbon peaking goals.

China's National Development and Reform Commission (NDRC) on April 18 vowed to double the country's non-fossil energy supply by 2035. Wang Changlin, deputy director of NDRC, proposed a low-carbon, safe and efficient energy system that features non-fossil energy as the primary source of supply, with fossil energy providing the baseline guarantee.

"This represents the only viable path for China to achieve a green and low-carbon energy transition," Wang said, adding the strategic importance of this new energy framework.

The 14th Five-Year Plan period from 2021 to 2025 has already seen China's non-fossil energy production overtake energy generated from oil, making wind and solar another pillar of China's energy security.