Overview
- The conflict that began Feb. 28 closed the Strait of Hormuz and removed more than 14 million barrels per day from world markets, triggering an acute supply shock that pushed prices toward $120 a barrel.
- China cut crude purchases from a pre‑war average of about 11.6 million bpd to under 8 million bpd in May, a drop confirmed by Beijing customs data that has helped restrain a larger global price spike.
- An interim US‑Iran framework in mid‑June cleared the way for Iranian sales to resume and for shipments to move from ports such as Chabahar, with sellers offering discounts to win back price‑sensitive Chinese buyers.
- Markets have already responded to returning Iranian barrels, with crude sliding roughly 5 percent toward the mid‑$70s per barrel, though full physical normalization faces weeks to months of logistics work such as mine clearance and insurance re‑settlement.
- Analysts warn some lost Chinese demand may be permanent, with estimates of 200,000 to 600,000 bpd not returning and smaller independent Chinese refiners having been hit hardest by the interruption and the need to rebuild stockpiles.