China’s crude oil imports reached an all-time high last year, raising fresh questions about claims that the world’s largest energy consumer is moving into a period of irreversible decline in oil demand. According to official data cited by Reuters, China imported an average of 11.55 million barrels of crude oil per day in 2025, amounting to 557.73 million tons — a 4.4% increase compared to the previous year. December alone marked a record, with imports averaging 13.18 million barrels per day.

These figures complicate the widely held view that China’s oil consumption is steadily shrinking due to rapid electrification of transport and slowing economic growth. While electric vehicles are gaining market share, the surge in imports suggests that oil still plays a central role in China’s energy strategy — albeit for reasons that extend beyond immediate consumption.

A significant portion of the imported crude has been diverted into storage rather than burned as fuel. Analysts say China has been stockpiling oil aggressively since March 2025, at a pace close to one million barrels per day. Frederic Lasserre, global head of research at commodity trading firm Gunvor, noted that China is likely to continue building its strategic and commercial reserves well into 2026. With current storage facilities only about 60% full, the country has substantial room to accumulate more crude.

This aggressive stockpiling has broader implications for global oil markets. China’s strong buying appetite has helped support oil prices at a time when OPEC+ production increases and concerns about weak global demand might otherwise have pushed prices lower. Persistent uncertainty around U.S. trade policies and tariffs has also weighed on demand expectations, making China’s purchases a stabilizing force in the market.

Adding to this trend, China is rapidly expanding its oil storage infrastructure. Between 2025 and 2026, eleven new storage sites are expected to come online, with a combined capacity of approximately 169 million barrels — equivalent to about two weeks of the country’s crude oil imports. This expansion follows substantial capacity additions between 2020 and 2024, underscoring Beijing’s long-term focus on energy security.

Ultimately, China’s record oil imports do not necessarily signal a resurgence in consumption, but they do highlight a strategic approach to managing supply risks. Rather than turning away from oil altogether, China appears to be using the current market environment to strengthen its reserves, ensuring energy stability in an increasingly uncertain global landscape. Is China preparing for future supply shocks, or are we underestimating how central oil will remain to its economy?

 Credit: Independent News Pakistan (INP)