The Chinese Communist Party announced on Wednesday that it had dramatically expanded the scope of the country’s known oil and gas reserves, claiming to have found 225 “large and medium-sized crude oil and natural gas fields” between 2021 and 2025.
China is the world’s largest oil importer, maintaining large demand for fuel but not enough oil deposits to address that demand domestically. While often considered not a major oil exporter due to having to meet that demand at home, China is actually the fifth-largest producer of oil. In addition to its production, China is home to a large number of what are known as “teapot” refineries, facilities that process crude oil both domestically and from abroad on a smaller scale.
The Chinese Ministry of Natural Resources made the announcement as the nation struggles to address its massive fuel demands, strained in part by the ongoing conflict between America and Iran in the Middle East. China, a close ally to the Iranian terrorist regime, is the world’s largest oil importer and the country most affected by the limitations on commercial shipping through the Strait of Hormuz. A growing number of Chinese teapot refineries are also facing American sanctions in response to them processing Iranian oil, a violation of international sanctions. Iranian leaders have attempted for the past month to block most civilian transit through the strait as a means of pressuring the world to work towards ending actions against it, while the United States imposed a naval blockade on Iranian commercial ships passing through — many of which would be en route to China.
The Chinese government — including, publicly, dictator Xi Jinping — has made its irritation with the situation apparent, demanding that all involved parties cease their disturbances of shipping. Some reports suggest that the Chinese economy suffered measurably in the past month as crude oil imports were not guaranteed. Crude oil is refined to create various fuels, including gasoline, but also plays a role in the manufacturing of plastics and other consumer goods; China is the world’s largest manufacturing power.
According to the state propaganda newspaper Global Times, which cited the National Resources Ministry, Chinese officials confirmed the existence of over 200 oil and gas field “including 13 oil fields with reserves exceeding 100 million tons and 26 gas fields with reserves exceeding 100 billion cubic meters.”
Ministry official Niu Li emphasized during a press conference that the Chinese government was striving to limit energy dependency, attempting to stretch the limits of finding new oil and gas fields and “firmly placing the initiative for energy security in our own hands.” The state newspaper observed that China broke its own oil production records in 2025, and the Communist Party has “made oil and gas the top priority of the new round of strategic mineral exploration breakthroughs.”
China’s domestic crude oil production is responsible for nearly 27 percent of the crude oil in its market, compared to about 73 percent of oil coming from abroad. As the world’s top oil importer, the country is heavily dependent on foreign oil production to maintain its economy. A third of these oil imports into China flow through the Strait of Hormuz — in addition to about 25 percent of its natural gas — making the Iran conflict devastating for China. In addition, the teapot refinery industry is almost entirely sustained by Iran; Reuters estimated this week that about 90 percent of Iranian crude shipments went to Chinese teapot refineries in March, or about 1.8 million barrels per day (bpd).
In recognition of the role China plays in propping up the Iranian government, the U.S. Treasury Department announced fresh sanctions this week on Hengli Petrochemical, a teapot refinery in Dalian, China, in response to its role in processing Iranian oil.
“China-based independent teapot refineries continue to play a vital role in sustaining Iran’s oil economy, and Hengli is one of Iran’s largest customers for crude oil and other petroleum products, having purchased billions of dollars’ worth of Iranian petroleum,” the Office of Foreign Assets Control (OFAC) detailed in the announcement of the new sanction.
The Chinese government has used its Foreign Ministry and other public-facing organs to primarily condemn the United States for taking military action against the Iranian regime and thus causing the current crisis. Unlike in past conflicts, however, Beijing has made occasional calls to peace that do not explicitly exonerate Iran, indicating growing frustration within the Communist Party with its longtime ally. During a phone call with Saudi Crown Prince Mohammed bin Salman this month, for example, dictator Xi Jinping pressed for free transit in the Strait of Hormuz, failing to point fingers at those involved in the issue. The subtle lack of condemnation of America was telling in itself.
“President Xi emphasized that China calls for an immediate and comprehensive ceasefire, supports all efforts conducive to restoring peace, and stands for resolving disputes through political and diplomatic means,” the Chinese Foreign Ministry explained in its readout of the phone call. “The Strait of Hormuz should maintain normal passage, as this serves the common interests of regional countries and the international community.”
Follow Frances Martel on Facebook and Twitter.
Read the full article here