China's Demand Cuts Keep Brent Below $100 as Hormuz Risk Persists
China slashed crude imports by 4.6 million barrels a day this year, suppressing Brent by an estimated $10-$15 per barrel despite the worst supply disruption on record.
ICE Brent crude front-month was trading at $98.94 per barrel on Wednesday (2026-09-23), having pulled back from a brief $101.61 breach recorded on Thursday (2026-09-03). Brent has now approached the $100 threshold three times this year, up roughly 60% in 2026. The supply shock behind that rally — disruptions at the Strait of Hormuz — would have pushed prices further were it not for Beijing.6,3
The International Energy Agency calculated that China slashed crude imports by 40%, or 4.6 million barrels a day, between February and May, directly offsetting a substantial portion of the supply shock. Goldman Sachs estimated that without those cuts, Brent would be $10 to $15 per barrel higher than current levels.7
China entered 2026 running at roughly 12 million barrels a day through February, according to the US Energy Information Administration. The reversal was sharp. Imports fell to approximately 7.2 million barrels a day in June, according to Enverus Intelligence Research. Goldman attributed 1.3 million barrels a day of the July drop alone to Beijing switching from inventory-building last year to drawing down stored crude since May.7,1
Goldman's estimate of China's visible stocks remains above 1.1 billion barrels, giving Beijing room to keep suppressing purchases without cutting domestic supply. That buffer is central to why the market has not fully repriced Hormuz risk into forward balances.7
The direction is now reversing. ING analysts said China increased crude purchases in recent weeks following several months of suppressed demand. Bloomberg reported the rebound comes as refinery processing margins have improved, fuel exports have resumed, and commercial restocking has picked up. ICE Brent front-month has gained nearly 30% from its early August lows.6,5
Enverus Intelligence Research is maintaining its Brent forecast at $100 per barrel across H2 2026 and through 2027, citing recovering Chinese demand and continued chokepoint risk. In a statement issued on Tuesday (2026-08-04), EIR said its models assumed Strait of Hormuz throughput recovering to 95% of the roughly 20 million barrel a day prewar baseline by year-end 2026. Any slippage in that timeline rewrites the supply balance quickly. Saudi Aramco's facilities in Jazan came under a fresh attack on Monday (2026-09-07), according to people familiar with the matter, though the impact on throughput was not confirmed.1,3
Supply signals were not uniformly tight. EIR also flagged a reported 2.7 million-barrel rise in US crude inventories, indicating production and imports exceeded immediate refinery demand — a signal that put downward pressure on prices alongside uncertainty about the pace of Chinese restocking.1
China's macro backdrop keeps the demand rebound on uncertain footing. Retail sales in China came in well below the Reuters poll estimate of 1.5% growth despite summer tourism spending, and most July economic indicators continued to undershoot analyst expectations. A restocking cycle driven by improved refinery margins can run alongside weak underlying consumption for months before the distinction registers in import data.2
Prediction markets priced just a 1.3% probability of crude reaching an all-time high by September 30 (2026-09-30), rising to 9.5% by December 31 (2026-12-31), according to data compiled by CryptoBriefing. The skepticism about a sustained move through $100 rests on Beijing's inventory cushion and the pace at which it chooses to reload. If the drawdown Goldman estimated accelerates faster than expected, restocking demand arrives sooner and larger than current prices reflect.4,7