Chinese Imports of Iranian Oil Plummet Nearly 50 Percent Amid Middle East Conflict

China, the world's leading crude importer and primary buyer of Iranian oil, has seen its imports from Iran drop sharply as ongoing conflict disrupts vital shipping routes through the Strait of Hormuz and the Bab Al Mandeb.

According to Kpler data, Chinese imports of Iranian crude via the Strait of Hormuz averaged approximately 530,000 barrels a day during July and August. This figure represents a 48 percent decline from pre-war levels and a steep 72 percent drop compared to the October 2024 peak, when imports neared 1.9 million barrels per day (bpd).

Iranian oil has long served as a vital source of discounted crude for China's smaller independent "teapot" refiners, providing these private plants with essential support for their refining margins. While China initially maintained steady imports due to its friendly ties with Iran, navigation through the crucial Strait of Hormuz has grown increasingly perilous amid Iranian and US blockades.

To compensate, Beijing initially rerouted shipments through the Red Sea as Saudi Arabia boosted exports from western terminals, pushing Chinese crude imports via the northern Suez Canal and the southern Bab Al Mandeb to 2.62 million bpd in April. However, following the Houthi blockade of Saudi vessels, import volumes fell sharply to 940,000 bpd in July and hovered around 1.02 million bpd in August.

Refiners and shipping operators are now adopting costly workarounds, including loading at Sidi Kerir—the Mediterranean terminal for Egypt's Sumed pipeline—or waiting outside the Strait of Hormuz for shuttle tankers. These detours have dramatically extended voyage times to Asia, such as a 50-day journey around the Cape of Good Hope compared to the usual 25 to 27 days via Bab Al Mandeb. Consequently, Suez route freight costs have doubled to roughly $10-$11 a barrel.

Additional pressure mounts from Washington, which has warned that nations continuing commercial ties with Iran could face secondary sanctions, though Chinese banks have thus far avoided penalties. Beijing has firmly rejected unilateral US sanctions, vowing to safeguard its strategic energy interests while relying on a substantial domestic oil buffer of an estimated 1 billion to 1.4 billion barrels to absorb delays and rising transport costs.