The Most Important Iran Oil Chart 1

THE MOST IMPORTANT IRAN OIL CHART? Rory Green 28 Jul 2026

Geopolitics and infrastructure add upside risks to Chinese oil imports. Watch tanker arrivals to gauge the speed of PRC demand recovery.

1/7 China is arguably the biggest reason reason why the Iran war-driven oil price surge fell well short of doomsayers’ talk of $200/bbl. However, high-frequency data suggest oil flows are returning to the PRC. For now, this reflects the June resumption of Iranian exports. Going forward, geopolitics and infrastructure spending are likely to accelerate Chinese imports.

2/7 China has materially cut oil imports with minimal impact on domestic economic activity. A combination of high levels of electrification, state stockpiles, large commercial inventories of refined products, and some demand destruction has pushed import volumes to 10-year lows.

3/7 The size of existing commercial inventories was overlooked. Stocks of key refined products remain around 50% higher than they were pre- covid. Industry has been able to draw down reserves with relatively limited impact on prices or economic activity.

4/7 Beijing's reaction function is also critical. In contrast to previous geoeconomic shocks, leaders did not encourage stockpiling. Officials appear confident that (1) significant electrification and existing reserves would insulate the economy and (2) any disruption to oil supplies would likely be short-lived.