Global crude oil prices remained below $100 a barrel despite the Strait of Hormuz being closed for more than five months, defying initial alarms about acute supply shocks and sharp price increases worldwide.
Pump prices remained high due to an ongoing crisis in refining capacity. But even with record refining margins, consumer prices stayed below levels seen in March and April, indicating a suppressed impact from the supply disruption.
China's sharp reduction in seaborne crude oil imports—dubbed the "Beijing Swing"—largely blunted the price crisis. Beijing cut its imports by 5.4 million barrels per day from prewar levels through June, covering most of the oil supply loss from the Hormuz closure.
That volume represents more than 40 percent of China's total prewar imports, is roughly equivalent to India's entire petroleum demand and brought Chinese crude imports to their lowest level since 2015.
The import cut also exceeded the collective volume of strategic petroleum releases by all International Energy Agency member states. The pullback altered market dynamics during a critical period of supply constraint.
The initial decrease in China's imports appeared unremarkable, as the country, like much of Asia, sources a large portion of its crude from the Middle East. But while other Asian nations saw their crude imports bottom out in April and May before recovering through June, China's imports continued to fall.
That sustained withdrawal from competition for scarce seaborne barrels, combined with the global release of strategic petroleum stocks, facilitated a recovery across other Asian markets. Analysts estimate the reduction cut $30 or more from Brent crude prices.
Beijing also cut its seaborne imports of Russian crude from prewar levels—despite Russian crude exports being unaffected by the Hormuz disruption and rising during the conflict.
The exact methods China used to achieve this reduction and its underlying motivations remain subjects of debate. The opaque and incomplete nature of Chinese energy data, unlike that of most other major consuming nations, complicates efforts to fully understand the shift.
