"China clearly imports the most, so why is it the most relaxed? I just can't figure it out."

Ask AI · How can the electric vehicle boom help China’s energy security?

【Text / Observer Network 熊超然】The current Middle East war has triggered a global energy crisis, causing suffering for countries around the world. What puzzles some people is that, as the country that imports the most oil through the Strait of Hormuz, China is also one of the countries most capable of calmly responding to the closure of this critical shipping route.

“How does China cope when the Strait of Hormuz is lost?” With this seemingly paradoxical question on the surface, Reuters published a visual data report on April 1, analyzing from multiple aspects why China can remain calm and unperturbed amid this global energy turmoil.

China has imported a large amount of oil from the Gulf region, roughly equivalent to the total of India, Japan, and South Korea combined. In the crisis, Asian countries began to tighten their belts, calling on the public to either shorten shower times or work from home to save energy, while China has long emphasized— the energy security, the “rice bowl” of energy, must be firmly in its own hands.

In fact, over the years, a series of policy measures by China have reduced its vulnerability to energy shocks; during difficult times, China still has more buffer capacity than many neighboring countries.

China possesses an electric vehicle fleet nearly as large as the combined total of other countries, has vast and still-growing oil reserves, and diversified sources of oil and natural gas supplies. Moreover, thanks to abundant domestic coal resources and renewable energy, China’s power supply system almost entirely does not rely on imports.

Laurie Myllyvirta, co-founder of the Finnish think tank Center for Energy and Clean Air Research (CREA), said: “The current situation is very close to the blueprint envisioned by Chinese policy planners over the past decades.” He pointed out: “This fully confirms the correctness of the strategic direction to reduce dependence on maritime fossil fuels.”

Main countries, regions, and the amount of crude oil imported via the Strait of Hormuz (Q1 2025, unit: ten thousand barrels/day) Reuters map

Unexpected Electric Vehicle Boom

By the end of 2020, China set a goal—that by 2025, electric vehicles should account for 20% of new car sales. By last year, this proportion had soared to half of all new car sales.

Reuters believes that this explosive growth in the electric vehicle market means that, after decades of rapid growth, China’s fuel consumption has peaked and begun to stabilize. Compared to a few years ago, China now consumes and imports less oil.

CREA’s estimate is quite straightforward: last year, the reduction in oil consumption due to the popularity of electric vehicles was roughly equivalent to the total amount of oil China imports from Saudi Arabia.

Annual oil replacement by electric vehicles in China, blue for CREA data, orange for IEA data (2025 forecast not yet available). Reuters map

Self-sufficient Power Supply System

Regarding electricity, which is closely related to ordinary people, China’s power supply system is almost entirely supported by coal and rapidly developing renewable energy.

Compared to the targets set by the Chinese government, the growth rate in clean energy has even exceeded the goals, reaching a level where the nearly all of the new electricity demand each year can be met by newly built solar or wind power facilities.

This means that coal imports will likely decrease, and imports of liquefied natural gas (LNG) will also decline, especially in a few coastal provinces that incorporate LNG into their power mix.

China’s power generation sources by proportion. Since 2010, coal (orange) has significantly declined, while renewable energy (purple) has risen sharply. Reuters map

Large Oil Imports, Diversified Supply Sources

Admittedly, China’s oil imports are huge, but unlike other major Asian importers, China prudently pursues an independent strategy to avoid over-reliance on any single supplier.

Japan typically sources nearly 80% of its oil from Saudi Arabia and the UAE. In contrast, China sources an equal share of oil from eight different countries—including large volumes of discounted oil from Russia, Venezuela, and Iran.

Additionally, Reuters describes China’s strategic oil reserves as “mysterious,” with some imported oil also injected into these reserves. Although the exact size of these reserves is unknown externally, some estimates suggest that, when combining strategic reserves with commercial refinery inventories, China’s total oil reserves could substitute for oil imported through the Strait of Hormuz for about seven months.

Crude oil imports by source for major Asian importers. Compared to Japan, South Korea, and India, less than 20% of China’s oil imports come from a single source. Reuters map

Recently, Japanese media Nikkei Asia also noted a trend, publishing a report on March 31. Citing a report from European commodities and energy market research firm Kpler on March 25, it states that nearly 600k barrels/day of U.S. crude oil are scheduled to be loaded onto tankers heading to China in April, with several ships heading to the largest U.S. oil port in Corpus Christi, Texas, and nearly 300k tons of U.S. LNG also scheduled for loading in March.

Nikkei Asia states that these energy resources could still be rerouted to Japan or South Korea. But if they ultimately unload in China, it would mark the first resumption of U.S. energy exports to China since February 2025 (crude oil) and December 2024 (LNG), before President Trump’s return to the White House.

Kpler’s report suggests that China seeks more procurement options and may re-purchase U.S. products, indicating a shift in China’s energy security policy to prioritize diversification over diplomatic stance.

Domestic Production Continues to Grow

Last year, China’s daily oil production reached a record high of 4.3 million barrels, accounting for about 40% of its total oil imports that year.

In terms of natural gas, thanks to rapid domestic production growth and pipeline imports, China’s LNG imports are actually below 2020 levels.

Since 2015, China’s natural gas sources relative to consumption have been as follows: LNG imports via shipping (left bar) have remained relatively stable, pipeline natural gas (middle bar) has increased year by year, and domestic natural gas production (right bar) has also increased annually. Reuters map

With an increasingly完善 pipeline network, China has reduced over-reliance on maritime imports and shifted to sourcing oil and natural gas from Russia, Central Asia, and Myanmar. China has also proposed a grand plan to build another China-Russia gas pipeline—“Siberia Force 2”—a key project in recent China-Russia energy cooperation.

Towards a Safer Future

Reuters states that for decades, China’s economic growth has been driven by imported fossil fuels, especially crude oil. However, with the booming electric vehicle industry, China is gradually reducing its dependence on foreign oil, injecting new momentum into its economic engine.

“China’s oil demand is likely to peak this year and then decline,” said Chen Lin (pseudonym), an energy analyst at Rystad Energy. “Therefore, although oil imports will still account for a high proportion of overall supply, the severe situation China faces in energy supply is not expected to worsen further.”

On March 31, 2026, in Qingdao, Shandong, the busy operations at Qingdao Port’s crude oil terminal, with a tanker docked. IC Photo

The sudden outbreak of Middle East conflict has caused intense shocks in the global energy market, with many countries anxious about supply. Why is China so calm? This contrast has become a hot topic of discussion recently, and of course, not only Reuters has noticed this.

“China holds two cards: electric vehicles and renewable energy,” The New York Times pointed out on March 14, noting that China has invested hundreds of billions of dollars over decades to develop electric vehicles and renewable energy, and this long-term strategy is now bearing fruit.

The Financial Times published on March 29 that the Middle East conflict could have seriously threatened China’s energy security as the world’s largest oil importer, but China’s resilient energy system, clean energy technology, and autonomous full industry chain layout have not only attracted massive green energy investments but also made China the “last supplier” of key industrial materials. It has also established a more stable and reliable partnership image internationally compared to the U.S., further consolidating its status as a “superpower.”

Besides foreign media, Goldman Sachs’ chief China equity strategist Liu Jinjing also explicitly stated in a research report on March 30 that compared to similar economies worldwide, China is in a more advantageous position amid this round of oil price fluctuations. This significant advantage is not a short-term coincidence but the result of a decade of strategic energy planning.

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