Behind the import collapse sits a deliberate three‑lever strategy. Goldman Sachs commodities strategist Hongcen Wei identified the tools Beijing has used to contain the economic fallout: drawing down fuel inventories, switching to coal and renewables, and concentrating production cuts in oil‑ and gas‑intensive industries. China’s real GDP growth slowed to an annualized 3.6% in the second quarter from 5.3% in the first, yet total energy demand still rose 0.4% year‑on‑year in April and May. Destocking of coal, oil and natural gas added 5.4 percentage points to energy‑demand growth, while lower oil and gas use subtracted 1.7 percentage points.
The supply shock has also redrawn China’s crude sourcing map. Dependence on Russian crude rose to a record 23.6% in the first half of 2026 as Middle Eastern barrels became harder to move. In June, Russian supplies made up 29% of China’s crude imports while Saudi supplies fell to just 5%. Overall China‑Russia trade hit a record $134.18 billion in the first half, up 25.6% from a year earlier.
China’s vast stockpiles—estimated at roughly 1.2 billion barrels—give it room to maneuver. Near‑term imports may rebound in August and September from cargoes loaded during the brief US‑Iran ceasefire, but higher prices are likely to curb arrivals again from October onward. At the same time, product exports of light and middle distillates are already recovering, with Kpler tracking roughly 787,000 bpd for July, while Asian refining margins remain extremely strong.