The global oil market faced unprecedented disruption from the Middle East, yet crude prices have remained remarkably stable, largely due to significant interventions by the United States and China. A massive supply shock, triggered by Iran’s blockade of the Strait of Hormuz, halted approximately 10 million barrels per day (bpd) of exports from the Persian Gulf—a volume equivalent to roughly 10% of total global consumption. Despite this historic loss, crude benchmarks like Brent have held around $100 per barrel, notably lower than prices observed during smaller disruptions, such as the 2022 conflict following Russia’s invasion of Ukraine.

The world’s two largest economies, both major players in the energy sector, implemented critical measures to offset the deficit. The United States, a leading oil producer and exporter, substantially increased its oil exports from non-Middle Eastern sources, boosting shipments by an estimated 3.5 million bpd. Concurrently, China, the world’s largest oil importer, dramatically reduced its inbound crude purchases by 3.6 million bpd, a volume comparable to Japan’s entire daily consumption. These combined actions injected approximately 7.1 million bpd back into the market, covering about 70% of the exports lost from the Gulf. Additionally, nations such as Japan, South Korea, and India collectively decreased their imports by another 3.6 million bpd, further easing market pressure.

Amidst the crisis, President Donald Trump met with President Xi Jinping in Beijing, where both leaders underscored the vital importance of keeping the Strait of Hormuz open for the free flow of energy. While the timeline for the strait’s full reopening to commercial shipping remains uncertain, the U.S. Energy Secretary affirmed the nation’s commitment to expanding its oil and refined product supply, anticipating increased future oil trade with China. However, the long-term sustainability of these mitigation efforts is a growing concern. China possesses a substantial strategic oil reserve, reportedly holding 1.4 billion barrels, which could sustain its reduced import levels for several months. In contrast, U.S. inventories, including its strategic reserve, are under considerable pressure, as the surge in exports has largely drawn from existing stockpiles rather than an increase in domestic production. The U.S. had a reserve of 413 million barrels at the end of last year and had previously committed to deploying 172 million barrels in response to the oil shock.