The supply of crude oil in the Middle East is important for China’s energy security

The Middle East region has close economic and trade relations with China.As of the end of 2023,among the top 10 crude oil import source countries in China,crude oil countries in the Middle East occupy 5 seats.Among them,Saudi Arabia is China’s largest trading partner in the Middle East region,and China is also Saudi Arabia’s largest crude oil export market.Since 2022,China has reached multiple cooperation agreements with Saudi Arabia in the field of energy trade.Saudi crude oil exports to China mainly rely on sea transportation through the Strait of Hormuz.The replacement of the President of Iran,an energy powerhouse,will to some extent pose risks to the geopolitical situation in the Middle East,affecting the scale of Middle Eastern crude oil exports to Asia or China,and thus posing risks to China’s energy security.

Overall,as an energy powerhouse in the Middle East,a presidential change in Iran may trigger geopolitical tensions and changes in crude oil policies.As one of the potential sources of risk,the market may be concerned about the tight supply of crude oil in the future,which may also push up crude oil futures prices at some point in the future.