China’s energy security has been strained by recent disruptions to discounted supplies from Iran and Venezuela. At times Beijing relied on Iranian crude for as much as one-fifth of its imports and took roughly 4–5% from Venezuela, much of it moved through covert channels to evade U.S. sanctions. Recent U.S. measures — including the diversion of some Venezuelan shipments to the United States and tariffs on Iran-linked trade — have intensified scrutiny of whether China can substitute domestic output when imports are constrained.
Domestic production has increased since President Xi Jinping launched a 2019 Seven-Year Action Plan to boost exploration and refining. Output rose from about 3.8 million barrels per day (bpd) in 2018 to roughly 4.32 million bpd in the latest year, driven by new wells, fracking and offshore projects. Those gains have largely offset declines at aging giant fields such as Daqing and Shengli. Analysts note cumulative growth since 2021 of around 8.9% is meaningful, but they also warn that China’s main oil firms — CNPC, Sinopec and CNOOC — are finding it hard to locate large new reserves, so rapid further boosts in production are unlikely.
Geography and geopolitics add to the vulnerability. Most crude arriving in China transits the narrow Malacca Strait, a congested maritime chokepoint long viewed by Beijing as a strategic risk and frequently patrolled by the U.S. Navy. That dependence on seaborne routes makes supply disruptions both a political and a military concern.
With limited near‑term upside in domestic supply, Beijing has leaned more heavily on strategic buffers. Since late 2023 China accelerated filling its strategic petroleum reserve (SPR), a response to higher global prices and geopolitical shocks such as Russia’s invasion of Ukraine. Purchases from Russia and discounted cargoes from Iran helped cushion the country after 2022–23 disturbances; reporting shows covert Iranian shipments — including ship‑to‑ship transfers and relabeling — moved significant volumes to China, at one point reportedly totaling as much as 2 million bpd.
New storage capacity has expanded through 2024–25. Analysts estimate China’s combined SPR and commercial stocks now cover about 110 days of consumption, above the OECD’s 90‑day benchmark, while Beijing’s internal aim is reportedly as much as 180 days. Given constrained production gains, most observers expect stockpiles to remain the principal short‑term buffer against further import interruptions.
Longer‑term resilience, however, depends less on more oil and more on reduced oil dependence. Beijing has accelerated electrification and a massive build‑out of renewables. Authorities are shifting transport and heavy industry toward electricity, upgrading transmission networks and building ultra‑high‑voltage lines to move power from inland generation to coastal industrial centers.
Electric vehicles now account for well over half of new car sales, and several cities — including Shenzhen and Guangzhou — operate largely electric bus fleets. The expansion of more than a million EV charging points has helped cap gasoline demand even as economic activity grows. China also added more solar capacity in 2024–25 than the rest of the world combined, while wind installations have surged across regions such as Inner Mongolia, Xinjiang and coastal provinces. Analysts estimate annual wind and solar capacity growth has averaged over 300 gigawatts in recent years and likely neared 400 gigawatts last year.
Those shifts will not eliminate the need for imported crude, but they blunt the impact of disruptions from sanctioned suppliers by substituting electricity for oil in transport, industry and buildings. Policymakers preparing the next five‑year plan are expected to pursue a mix of modest additional fossil investment where feasible, continued SPR filling, and strong support for electrification and renewable expansion to reduce vulnerability to sudden supply shocks.