China has directed at least two of its largest oil refineries to maintain or even increase fuel processing rates as renewed fighting between Iran and the United States raises the risk of disruptions to crude shipments through the Persian Gulf, according to sources cited by Bloomberg. The instruction comes despite elevated gasoline and diesel inventories and a structural slowdown in domestic fuel demand.
Earlier in the conflict, Chinese authorities curbed exports of gasoline, diesel and jet fuel to safeguard domestic supplies, but those restrictions were later eased and additional export quotas were issued earlier this month. Nevertheless, Beijing has signalled that it will not revise the July export quotas, indicating a continued focus on ensuring sufficient domestic fuel availability while avoiding further changes to export policy.
The directive is expected to push refinery utilisation higher, adding pressure to already weak Asian refining margins. The spread between regional gasoline prices and Dubai crude has fallen to its lowest level since late March.
China, the world’s largest crude oil importer, has been closely monitoring energy security as fighting intensifies around the Strait of Hormuz, a key transit route that carries roughly one‑fifth of global oil consumption. The measures suggest Beijing is preparing for a prolonged period of elevated geopolitical risk even as domestic fuel demand remains subdued.