Asian crude import data contradict claims of recovering Hormuz flows
Chinese purchases fell to a decade low in June and alternative rerouting covers only a fraction of pre-war Hormuz throughput, pointing to a more persistent supply disruption.
ICE Brent front-month was trading at $89.57 a barrel in early trade on Friday (2026-08-28), holding near recent highs as the Gulf conflict keeps buyers cautious. But the clearest measure of how much oil is actually moving, Asian crude import data, continues to tell a story at odds with narratives of recovering Hormuz transits.7
Chinese crude purchases fell 41% year-on-year in June 2026 to 7.12 million barrels per day, the lowest monthly reading since October 2016, according to data cited by oilprice.com. That followed a May reading of 7.8 million b/d, itself the weakest since October 2017. Asia's broader imports remained at multi-month lows in June, still well below pre-war levels despite a marginal recovery from May.7,23
If Hormuz transits were genuinely recovering, import volumes at Chinese and other Asian refiners would show it. They haven't. US forces struck Iran on July 7 (2026-07-07), the United States suspended Treasury licenses authorizing Iranian oil sales for 60 days, and observed tanker traffic through the Strait remained near zero, according to oilprice.com. China's decade-low imports reflect that reality.6,7
The rerouting story deserves more scrutiny. Saudi Arabia has accelerated flows through its East-West Pipeline to Yanbu, which can theoretically handle 7 million b/d, though actual port export capacity limits throughput to 5 million. The UAE has similarly ramped its pipeline to Fujairah, rated at 1.8 million b/d. Together, these alternative routes have rerouted approximately 4 million b/d since Hormuz effectively closed, according to invezz.com. The arithmetic does not close — 4 million b/d rerouted against the Strait's pre-war throughput of more than 20 million.1
US crude has stepped in as the most visible substitute. Traders reported at least 11 million barrels of American crude sold to Asian buyers late on Tuesday (2026-07-14), with further deals said to be in progress, according to Rigzone. US seaborne crude exports hit 5.6 million b/d in May, with weekly peaks reaching 6.3 million b/d, Kpler data showed. But those volumes arrive with longer lead times and higher landed costs than Gulf barrels, as freight and insurance charges widen on longer haul routes.5,1
India captures the cost squeeze. New Delhi's import bill jumped sharply after Trump proposed a 20% fee on Hormuz transits on Monday (2026-07-13), sending Brent to over $87 a barrel on Tuesday (2026-07-14) before he reversed course and prices eased to around $85. Even with the fee abandoned, Indian refiners face elevated freight and insurance on Gulf cargoes, and the shift to alternative origins is squeezing refinery margins.4
The first US LNG cargo to reach a Chinese terminal since February 2025 arrived in Hainan but entered bonded storage rather than clearing customs, because Beijing's 15% tariff keeps direct imports commercially unviable. That cargo can be re-exported or traded, but it does not represent Chinese demand recovering.7
Markets have repriced sharply on acute events, the Hormuz fee proposal and July 7 (2026-07-07) airstrikes among them, then given back gains when those specific catalysts passed. China's July crude import figures, due in coming weeks, are the concrete test. If purchases remain near the June trough of 7.12 million b/d rather than recovering toward pre-war levels, the supply disruption is proving more durable than the rerouting and substitution narrative implies.7,1