From the 1973 oil crisis to the Gulf wars, these questions largely sat at the very heart of global oil geopolitics. Later, Moscow sat alongside Riyadh through OPEC+. Then came the American shale oil revolution. The US surpassed Russia and Saudi Arabia to become the largest crude oil producer in the world, reaching a new record in 2025 with an average daily output of 13.6 million barrels. Now, there is a fourth power at the table: China.
However, Beijing's power is fundamentally different from the others. It is not the world's largest producer or exporter. Nor does it possess large spare production capacity like Saudi Arabia. Its weapon is different: the power to buy, and when necessary, to refrain from buying, as one of the world's largest oil purchasing powers. The war with Iran and the crisis in the Strait of Hormuz demonstrated just how vital this has become.
Why didn't oil reach 150 dollars?
The Strait of Hormuz is one of the most critical arteries of the global energy system. In 2025, approximately 20 million barrels of crude oil and petroleum products passed through daily. This corresponds to roughly one-quarter of global maritime oil trade. Furthermore, about 80% of the oil transiting Hormuz is destined for Asia. China and India alone purchased 44% of the crude oil passing through the strait. Therefore, when the war with Iran broke out and oil transit through Hormuz was severely disrupted, market panic was entirely understandable: oil could reach 150 dollars or perhaps even higher. Yet that did not happen.
Naturally, there was no single cause. Emergency reserves held by International Energy Agency (IEA) member states, alternative supply routes, producer responses, market expectations regarding conflict duration, and demand-side adjustments all played a role. However, China's behavior was particularly noteworthy. Prior to the war, China imported roughly 12 million barrels of crude oil per day. In June 2026, its imports dropped sharply to 7.12 million barrels per day. In July, imports rebounded to 8.41 million barrels. The June–July average, however, remained at 7.78 million barrels per day.
The new power: "I am not buying today"
In other words, one of the world's largest oil purchasing powers could, within a short timeframe, withdraw market demand exceeding 4 million barrels per day. Here begins the new dimension of oil geopolitics. Traditionally, the dominant actor in the oil market was the swing producer—the producer capable of rapidly scaling output up or down as required. Now, a formidable counterweight has emerged: the swing buyer, the marginal consumer. When Saudi Arabia withdraws a few million barrels from the market, it impacts prices. When China purchases a few million barrels less, it fundamentally alters the other side of the equation. One controls the tap; the other controls the wallet. To understand how we arrived at this point, one need only look at the last half-century of the energy landscape. Riyadh's influence stemmed not only from vast reserves, but also from spare production capacity that allowed it, when necessary, to flood the market with additional crude. Moscow, from 2016 onward through the OPEC+ mechanism, became the second pillar of this power architecture. Russia's weight in production and exports, combined with Saudi Arabia's spare capacity, forged the Riyadh–Moscow axis.
The comeback of the US
The third major shift originated in America. The shale oil revolution transformed the US into the world's leading crude oil producer. However, Washington cannot function like an OPEC nation. The White House cannot order thousands of independent producers in Texas to ramp up output by two million barrels tomorrow. The flexibility of American oil springs not from executive decrees, but from the reaction of prices, capital, technology, and drilling activity to market signals. Thus, three distinct forms of production power emerged in the energy world: Riyadh's spare capacity, Moscow's weight within OPEC+ and exports, and the scale and dynamic response of US shale. China brings a fourth type of power to the table: demand management capability.
China built this power over two decades
Ever since my years working in China, I have closely tracked the country's energy policy. There was a defining characteristic in Beijing's approach that always impressed me: they do not settle for meeting current demands; they calculate tomorrow's vulnerabilities today. Over the past twenty years, they invested heavily in foreign oilfields. They constructed cross-border pipelines from Russia and Central Asia. They cultivated long-term supply relationships extending from Africa to Latin America. They poured massive capital into ports, oil refineries, and storage facilities. They diversified supply sources across Russia, the Gulf, Iran, Africa, and Latin America, while expanding the scope of yuan-denominated energy trading. Simultaneously, they directed immense resources toward electric vehicles, battery technology, renewable energy, and nuclear power. These should not be viewed as isolated initiatives. They are all integrated components of a single overarching strategy: if energy dependency cannot be eliminated entirely, it must be rendered manageable.
Oil in storage is power
A critical tool that provided Beijing with strategic maneuvering room during the Iran crisis was its oil stockpiles. China's storage network is not as transparent as the US Strategic Petroleum Reserve. Beyond state reserves, there are commercial inventories held by state-owned enterprises, alongside storage facilities at refineries and coastal terminals. Consequently, we do not know the exact volume of its safety cushion with absolute certainty. Market estimates suggest total reserves may exceed 1.2 billion barrels. This oil should not be viewed merely as commercial inventory; it functions simultaneously as geopolitical insurance. You buy when oil is cheap. You fill your storage facilities. When a crisis strikes and everyone else is chasing overpriced crude, you can step back from the market for a time. For a major importer, strategic storage creates the tactical maneuverability that production capacity alone cannot provide.
Electric cars are also oil policy
The least discussed aspect of China's strategy is the electric vehicle revolution. We typically view electric cars through the lens of climate policy or automotive market competition. From Beijing's perspective, however, it carries a direct energy security dimension. China is the world's largest oil importer. Therefore, converting millions of vehicles from gasoline to electric power does not merely cut carbon emissions; it permanently reduces the volume of crude oil imports required in the future. One of China's primary strategic vulnerabilities lies in maritime choke points: the Straits of Hormuz and Malacca, the Indian Ocean, and the South China Sea. Electrification does not eliminate this dependency, but it significantly mitigates it. In this regard, every electric vehicle sold in China represents oil that will never need to be imported. When multiplied across millions of units, industrial policy transforms directly into energy geopolitics.
Is China becoming the central bank of oil?
I do not consider it accurate to label China as "the new Saudi Arabia." A more intriguing analogy applies: China is behaving increasingly like a central bank for the oil market. A central bank does not print all the money in an economy; it influences the market by managing liquidity. Similarly, China does not produce the majority of the world's oil. However, by jointly managing its massive demand, stockpiles, refining capacity, and energy transition, it gains expanding leverage over global market dynamics. It buys and stores when prices are depressed. When prices surge, it can curtail purchases. It can adjust refinery run rates and petroleum product exports at will. Through electrification, it curbs long-term oil demand. Furthermore, coordination between state apparatus and state enterprises is vastly higher than in Western market economies. This does not make China a swing producer in the traditional sense, but transforms it into a powerful swing buyer—a buyer capable of moving markets through demand shifts.
What can Greece learn?
Greece, of course, is not China. It lacks its economic scale, storage reserves, or purchasing leverage. Yet several vital lessons can be drawn from Beijing's approach. • First, strategic oil reserves must not be viewed merely as emergency vaults to be opened only during wartime. Managed effectively, they provide economic and geopolitical leverage. • Second, energy security is not secured after a crisis erupts, but when prices are low and global supply is abundant. • Third, supply route diversification is just as critical as source diversification. • Fourth, electric vehicles and transport electrification do not represent merely a climate initiative for Greece. They constitute an energy security policy capable of reducing oil imports, shrinking the current account deficit, and easing external vulnerability. • Fifth, we must stop viewing energy security strictly through oil and natural gas contracts. Refineries, storage facilities, ports, pipelines, power grids, nuclear energy, renewables, batteries, and critical minerals form a unified strategic framework. Therefore, the core question Greece must confront is not "Who will we buy oil from?" The real question is: when the next major energy shock hits, how long can we stand on our own feet?
The oil era is not ending, the definition of power is changing
The end of the oil age, which has been heralded for years, may indeed arrive one day. However, the transition we are experiencing today is fundamentally different. Oil is not disappearing; the definition of energy power is evolving. In the 20th century, power was measured largely by how many billions of barrels of oil lay beneath your soil. Today, the questions are different. How much can you produce? How much can you export? How much spare production capacity do you hold? How much can you store? How many distinct sources can you draw from? How quickly can you adjust your demand? And when prices spike, how long can you afford to stay out of the market? Judged by these criteria, the new oil order lacks a single capital city. Riyadh represents spare production capacity, Moscow embodies OPEC+ export influence, and America brings massive scale and shale dynamics. Beijing, on the other hand, represents the bargaining and purchasing power of the world's largest customer. The war with Iran made this fourth form of power fully visible. China asserts its weight not through oil wells, but through strategic reserves; not through exports, but through imports; not by closing the tap, but, when necessary, by closing its wallet. Perhaps this is the most profound shift in oil geopolitics in the 21st century: the fate of global oil is no longer determined solely by those who sell it. Those who buy it have earned their seat at the table.
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